Servicer
Special Servicer
Trustee
and
Fiscal Agent
POOLING AND SERVICING AGREEMENT
Dated as of ___________________ 1998
$
Commercial Mortgage Pass-Through Certificate
Series 1998-___
TABLE OF CONTENTS
ARTICLE I.
DEFINITIONS................................................. 5
SECTION 1.01. Defined Terms....................................................... 5
SECTION 1.02. Certain Calculations................................................ 43
ARTICLE II.
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES...................................... 44
SECTION 2.01. Conveyance of Mortgage Loans........................................ 44
SECTION 2.02. Acceptance by Trustee............................................... 46
SECTION 2.03. Representations, Warranties and Covenants of the Depositor;
Mortgage Loan Seller's Repurchase of Mortgage Loans for
Defects in Mortgage Files and Breaches of Representations
and Warranties...................................................... 48
SECTION 2.04. Execution of Certificates........................................... 50
ARTICLE III.
ADMINISTRATION AND
SERVICING OF THE TRUST FUND......................................... 50
SECTION 3.01. Servicer to Act as Servicer; Special Servicer to Act as
Special Servicer; Administration of the Mortgage Loans............. 50
SECTION 3.02. Collection of Mortgage Loan Payments................................ 52
SECTION 3.03. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts................................................. 53
SECTION 3.04. The Certificate Account and the Lower-Tier and
Upper-Tier Distribution Accounts................................... 55
SECTION 3.05. Permitted Withdrawals From the Certificate Account and
the Distribution Accounts.......................................... 58
SECTION 3.06. Investment of Funds in the Certificate Account, the
Distribution Accounts and the REO Account.......................... 61
SECTION 3.07. Maintenance of Insurance Policies; Errors and Omissions
and Fidelity Coverage.............................................. 63
SECTION 3.08. Enforcement of Due-On-Sale Clauses; Assumption Agreements........... 66
SECTION 3.09. Realization Upon Defaulted Mortgage Loans........................... 67
SECTION 3.10. Trustee to Cooperate; Release of Mortgage Files..................... 70
SECTION 3.11. Servicing Compensation.............................................. 71
SECTION 3.12. Inspections; Collection of Financial Statements..................... 73
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SECTION 3.13. Annual Statement as to Compliance................................... 74
SECTION 3.14. Reports by Independent Public Accountants........................... 74
SECTION 3.15. Access to Certain Information....................................... 75
SECTION 3.16. Title to REO Property; REO Account.................................. 76
SECTION 3.17. Management of REO Property.......................................... 77
SECTION 3.18. Sale of Defaulted Mortgage Loans and REO Properties................. 79
SECTION 3.19. [Intentionally Omitted]............................................. 81
SECTION 3.20. Modifications, Waivers, Amendments and Consents..................... 81
SECTION 3.21. Transfer of Servicing Between Servicer and Special
Servicer;Record Keeping; Asset Status Report....................... 84
SECTION 3.22. Sub-Servicing Agreements............................................ 87
SECTION 3.23. Representations and Warranties of the Servicer...................... 89
SECTION 3.24. Representations and Warranties of the Special Servicer.............. 91
SECTION 3.25. Duties of the Extension Adviser..................................... 93
SECTION 3.26. Extension Adviser; Elections........................................ 93
SECTION 3.27. Limitation on Liability of Extension Adviser........................ 95
ARTICLE IV.
PAYMENTS TO CERTIFICATEHOLDERS.........................................95
SECTION 4.01. Distributions........................................................95
SECTION 4.02. Statements to Certificateholders; Collection Reports................102
SECTION 4.03. P&I Advances........................................................105
SECTION 4.04. Allocation of Collateral Support Deficit............................107
SECTION 4.05. Appraisal Reductions................................................108
SECTION 4.06. Certificate Deferred Interest.......................................108
ARTICLE V.
THE CERTIFICATES...............................................109
SECTION 5.01. The Certificates....................................................109
SECTION 5.02. Registration of Transfer and Exchange of Certificates...............110
SECTION 5.03. Book-Entry Certificates.............................................117
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates...................119
SECTION 5.05. Persons Deemed Owners...............................................120
SECTION 5.06. Appointment of Paying Agent.........................................120
ARTICLE VI.
THE DEPOSITOR, THE SERVICER AND THE SPECIAL SERVICER.................120
SECTION 6.01. Liability of the Depositor, the Servicer and the Special
Servicer...........................................................120
SECTION 6.02. Merger, Consolidation or Conversion of the Depositor, the
Servicer or the Special Servicer...................................120
SECTION 6.03. Limitation on Liability of the Depositor, the Servicer, the
Special Servicer and Others........................................121
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SECTION 6.04. Depositor, Servicer and Special Servicer Not to Resign..............122
SECTION 6.05. Rights of the Depositor in Respect of the Servicer and the
Special Servicer...................................................123
ARTICLE VII.
DEFAULT...................................................123
SECTION 7.01. Events of Default; Servicer and Special Servicer Termination........123
SECTION 7.02. Trustee to Act; Appointment of Successor............................126
SECTION 7.03. Notification to Certificateholders..................................127
SECTION 7.04. Waiver of Events of Default.........................................127
SECTION 7.05. Trustee and Fiscal Agent as Makers of Advances......................128
ARTICLE VIII.
CONCERNING THE TRUSTEE AND FISCAL AGENT...................................129
SECTION 8.01. Duties of Trustee...................................................129
SECTION 8.02. Certain Matters Affecting the Trustee...............................130
SECTION 8.03. Trustee and Fiscal Agent Not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans......................131
SECTION 8.04. Trustee and Fiscal Agent May Own Certificates.......................132
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of Trustee
and Fiscal Agent...................................................132
SECTION 8.06. Eligibility Requirements for Trustee................................133
SECTION 8.07. Resignation and Removal of the Trustee and the Fiscal Agent.........133
SECTION 8.08. Successor Trustee and Fiscal Agent..................................135
SECTION 8.09. Merger or Consolidation of Trustee or Fiscal Agent..................136
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.......................136
SECTION 8.11. Appointment of Custodians...........................................137
SECTION 8.12. Access to Certain Information.......................................137
SECTION 8.13. Representations and Warranties of the Trustee and the
Fiscal Agent.......................................................139
ARTICLE IX.
TERMINATION.................................................142
SECTION 9.01. Termination Upon Repurchase or Liquidation of All Mortgage Loans....142
SECTION 9.02. Additional Termination Requirements.................................144
ARTICLE X.
ADDITIONAL REMIC PROVISIONS.........................................144
SECTION 10.01. REMIC Administration................................................144
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SECTION 10.02. Depositor, Special Servicer, Paying Agent and Trustee to
Cooperate with Servicer............................................149
SECTION 10.03. Use of Agents.......................................................149
ARTICLE XI.
MISCELLANEOUS PROVISIONS...........................................149
SECTION 11.01. Amendment...........................................................149
SECTION 11.02. Recordation of Agreement; Counterparts..............................151
SECTION 11.03. Limitation on Rights of Certificateholders..........................152
SECTION 11.04. Governing Law.......................................................153
SECTION 11.05. Notices.............................................................153
SECTION 11.06. Severability of Provisions..........................................153
SECTION 11.07. Grant of a Security Interest........................................154
SECTION 11.08. Successors and Assigns; Beneficiaries...............................154
SECTION 11.09. Article and Section Headings........................................154
SECTION 11.10 Notices to the Rating Agencies......................................154
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Exhibit A-1 Form of Class [A-1] Certificate
Exhibit A-2 Form of Class [A-2] Certificate
Exhibit A-3 Form of Class [B] Certificate
Exhibit A-4 Form of Class [C] Certificate
Exhibit A-5 Form of Class [D] Certificate
Exhibit A-6 Form of Class [E] Certificate
Exhibit A-7 Form of Class [F] Certificate
Exhibit A-8 Form of Class [G] Certificate
Exhibit A-9 Form of Class [H] Certificate
Exhibit A-10 Form of Class [X] Certificate
Exhibit A-11 Form of Class [R] Certificate
Exhibit A-12 Form of Class [LR] Certificate
Exhibit B Mortgage Loan Schedule
Exhibit C Form of Investment Representation Letter
Exhibit D-1 Form of Transfer Affidavit
Exhibit D-2 Form of Transferor Letter
Exhibit E [Intentionally Omitted]
Exhibit F Form of Request for Release
Exhibit G Form of ERISA Representation Letter
Exhibit H Form of Distribution Date Statement
SCHEDULES
Schedule 1 Computerized Database Information
Schedule 2 Borrower Concentrations in Excess of 5%
Schedule 3 Mortgage Loans Containing Affiliate Debt
Schedule 4 Mortgage Loans Which Initially Pay Interest Only
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This Pooling and Servicing Agreement (the "Agreement"), is dated and
effective as of ____________ 1998, among Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc. as Depositor, ____________ as Servicer, __________________, as
Special Servicer, _______________ as Fiscal Agent and ________________________
as Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell commercial mortgage pass-through
certificates (collectively, the "Certificates"), to be issued hereunder in
multiple classes (each, a "Class"), which in the aggregate will evidence the
entire beneficial ownership interest in the trust fund (the "Trust Fund") to be
created hereunder, the primary assets of which will be a pool of multifamily
and mobile home community mortgage loans (the "Mortgage Loans"). As provided
herein, the Servicer shall elect or shall cause an election to be made that
each of the Upper-Tier REMIC and the Lower-Tier REMIC be treated for federal
income tax purposes as a real estate mortgage investment conduit (a "REMIC").
The following table sets forth the designation, the pass-through rate
(the "Pass-Through Rate"), the aggregate initial principal amount (the
"Original Certificate Balance") or Notional Amount ("Original Notional
Amount"), as applicable, and the initial ratings given each Class by the Rating
Agencies (the "Original Ratings") for each Class of Certificates comprising the
interests in the Upper-Tier REMIC created hereunder:
UPPER-TIER REMIC
Original
=====================================================================================================
Class Original Rating
Designation Pass-Through Rate Certificate Balance ____/_____(1)
-----------------------------------------------------------------------------------------------------
Class [A-1]
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Class [A-2]
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Class [B]
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Class [C]
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Class [D]
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Class [E]
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Class [F]
-----------------------------------------------------------------------------------------------------
Class [G]
-----------------------------------------------------------------------------------------------------
Class [H]
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Class [X]
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Class [R] None (4)
=====================================================================================================
---------------------------------
(1) The Certificates marked with an asterisk have not been rated by the
applicable Rating Agency.
(2) The Class [X] Certificates will not have a Pass-Through Rate but will
bear interest in an amount for any Distribution Date equal to the sum
of one-month's interest at the then applicable Pass-Through Rates on
the Notional Amounts of the WAC Component and the [A-1] Component
immediately prior to such Distribution Date. The Pass-Through Rate for
the WAC Component for any Distribution Date will equal the excess, if
any, of the Weighted Average Net Mortgage Rate over ___%. The
Pass-Through Rate of the [WAC] Component for the first Distribution
Date is expected to be approximately ___% per annum. The Pass-Through
Rate for the [A-1] Component for any Distribution Date will equal ___%
per annum.
(3) The Class [X] Certificates will not have a Certificate Balance and
will not be entitled to receive distributions of principal. Interest
will accrue on the Components of such Class at the Pass-Through Rates
thereof on the Notional Amounts thereof. The Notional Amount of the
[WAC] Component for any Distribution Date will be equal to the
Notional Amount of the Class [LWAC] Uncertificated Interest, which
will be equal to the aggregate of the Stated Principal Balances of the
Mortgage Loans as of the preceding Distribution Date (after giving
effect to the distribution of principal on such Distribution Date) or,
in the case of the first Distribution Date, the Cut-off Date. The
original
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Notional Amount of the [WAC] Component is $__________. The Notional
Amount of the [A-1] Component is equal to the Lower-Tier Principal
Amount of the Class [LA-1] Uncertificated Interest as of the preceding
Distribution Date (after giving effect to the distribution of
principal and allocation of Collateral Support Deficit on such
Distribution Date) or in the case of the first Distribution Date, the
original Lower-Tier Principal Amount of the Class [LA-1]
Uncertificated Interest. The Original Notional Amount of the [A-1]
Component is $__________.
(4) The Class [R] Certificates do not have a Certificate Balance or
Notional Amount, do not bear interest and will not be entitled to
distributions of Prepayment Premiums or Yield Maintenance Charges. Any
Available Distribution Amount remaining in the Upper-Tier Distribution
Account, after all required distributions under this Agreement have
been made to each other Class of Certificates, will be distributed to
the Holders of the Class [R] Certificates.
The Class [A-1], Class [A-2], Class [B], Class [C], Class [D], Class
[E], Class [F], Class [G], Class [H] and Class [X] Certificate will evidence
"regular interests" in the Upper-Tier REMIC created hereunder. The sole Class
of "residual interests" in the Upper-Tier REMIC created hereunder will be
evidenced by the Class R Certificates. The Class [LA-1], Class [LA-2], Class
[LB], Class [LC], Class [LD], Class [LE], Class [LF], Class [LG], Class [LH]
and Class [LWAC] Uncertificated Interests will evidence "regular interests" in
the Lower-Tier REMIC created hereunder. The sole Class of "residual interests"
in the Lower-Tier REMIC created hereunder will be evidenced by the Class [LR]
Certificates.
The following table sets forth the initial Lower-Tier Principal
Amounts and per annum rates of interest for the Uncertificated Lower-Tier
Interests:
3
LOWER-TIER REMIC
Class Original Lower-Tier Principal
Designation Interest Rate Amount or Notional Amount
------------- ------------- -----------------------------
Class [LA-1]
Class [LA-2]
Class [LB]
Class [LC]
Class [LD]
Class [LE]
Class [LF]
Class [LG]
Class [LH]
Class [LWAC] (5) (6)
Class [LR] None(7) None (7)
---------------------------------
(5) The interest rate of the Class [LWAC] Uncertificated Interest is the
Weighted Average Net Mortgage Rate minus ___%.
(6) The Class [LWAC] Uncertificated Interest has a Notional Amount as of
any Distribution Date equal to the aggregate Stated Principal Balances
of the Mortgage Loans as of the preceding Distribution Date (after
giving effect to the distribution of principal and realized losses on
such Distribution Date), or the Cut-off Date in the case of the first
Distribution Date.
(7) The Class [LR] Certificates do not have a Certificate Balance or
Notional Amount, do not bear interest and will not be entitled to
distributions of Prepayment Premiums or Yield Maintenance Charges. Any
Available Distribution Amount remaining in the Lower-Tier Distribution
Account after distributing the Lower-Tier Distribution Amount shall be
distributed to the Holders of the Class [LR] Certificates (but only to
the extent of the Available Distribution Amount for such Distribution
Date remaining in the Lower-Tier Distribution Account, if any).
As of close of business on the Cut-off Date, the Mortgage Loans had an
aggregate principal balance, after application of all payments of principal due
on or before such date, whether or not received, equal to
$____________________.
In consideration of the mutual agreements herein contained, the
Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the Trustee
agree as follows:
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ARTICLE I.
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including in the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article.
"A-1 Component": One of the two components comprising the Class [X]
Certificates representing a "specified portion" (within the meaning of Treasury
Regulations Section 1.860G-l(a)(2)(i)(C)) of the interest payments on the Class
[LA-1] Uncertificated Interest.
"A-1 Component Interest Accrual Amount": With respect to each
Distribution Date, an amount equal to interest for the related Interest Accrual
Period at the A-1 Component Pass-Through Rate, accrued on the A-1 Notional
Amount outstanding immediately prior to such Distribution Date commencing in
the month of the Closing Date.
"A-1 Component Pass-Through Rate": With respect to any Distribution
Date, 0.200% per annum.
"A-1 Notional Amount": With respect to any Distribution Date, an
amount equal to the Lower-Tier Principal Amount of the Class [LA-1]
Uncertificated Interest.
"Accrued Certificate Interest": With respect to each Distribution Date
and each Class of Certificates (other than Class [X] Certificates and the
Residual Certificates), an amount equal to interest for the related Interest
Accrual Period at the Pass-Through Rate applicable to such Class of
Certificates for such Distribution Date, accrued on the related Certificate
Balance of such Class outstanding immediately prior to such Distribution Date
(i.e., such Certificate Balance is to be used for accrual of interest during
the related Interest Accrual Period notwithstanding the fact that such
Certificate Balance may be different than the actual Certificate Balance at the
start of such Interest Accrual Period) commencing in the month of the Closing
Date. With respect to each Distribution Date and the Class [X] Certificates,
the Class [X] Interest Accrual Amount. Accrued Certificate Interest shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
"Acquisition Date": With respect to any REO Property, the first day on
which such REO Property is considered to be acquired by the Trust Fund and the
Lower-Tier REMIC within the meaning of Treasury Regulation Section
1.856-6(b)(1), which is the first day on which the Lower-Tier REMIC is treated
as the owner of such REO Property for federal income tax purposes.
"Advance": Any P&I Advance or Servicing Advance.
"Adverse REMIC Event": As defined in Section 10.01(f).
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"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Affiliate Debt": With respect to any Mortgage Loan, any debt owed by
the related Mortgagor to an Affiliate of such Mortgagor as of the Closing Date
as set forth on Schedule 3 hereto.
"Agent": As defined in Section 5.02(d)(i)(A).
"Agreement": This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
"Appraisal": An appraisal prepared by an Independent MAI appraiser
with at least five years experience in properties of like kind and in the same
area, prepared in accordance with 12 C.F.R. 225.64.
"Appraisal Reduction": For any Distribution Date and for any Mortgage
Loan as to which an Appraisal Reduction Event has occurred, an amount equal to
the excess, if any, of (a) the Stated Principal Balance of such Mortgage Loan
over (b) the excess of (i) 90% of the Appraised Value of the related Mortgaged
Property over (ii) the sum of (a) to the extent not previously advanced by the
Servicer or the Trustee, all unpaid interest on such Mortgage Loan at a per
annum rate equal to its Mortgage Rate, (b) all unreimbursed Advances and
interest thereon at the Reimbursement Rate in respect of such Mortgage Loan and
(c) all currently due and unpaid real estate taxes and assessments and
insurance premiums and all other amounts due and unpaid with respect to such
Mortgage Loan, net of any amounts currently escrowed for such amounts (which
taxes, premiums and other amounts have not been subject to an Advance by the
Servicer or the Trustee, as applicable). Within 60 days after the Appraisal
Reduction Event, the Special Servicer shall obtain an Appraisal (the cost of
which shall be paid as a Servicing Advance by the Servicer); provided, however,
that with respect to an Appraisal Reduction Event as set forth in clause (ii)
of the definition of Appraisal Reduction Event, the Special Servicer shall
obtain such Appraisal within the 120 day period set forth in such clause (ii),
which Appraisal shall be delivered by the Special Servicer to the Servicer, and
the Servicer shall deliver such Appraisal to the Trustee, the Paying Agent and
each Holder of a Class [F], Class [G] and Class [H] Certificate within 15 days
of receipt by the Servicer of such Appraisal from the Special Servicer.
With respect to each Mortgage Loan as to which an Appraisal Reduction
has occurred (unless such Mortgage Loan has become a Corrected Mortgage Loan
and has remained current for twelve consecutive Monthly Payments (for such
purposes taking into account any amendment or modification of such Mortgage
Loan)), the Special Servicer shall, within 30 days of each annual anniversary
of the related Appraisal Reduction Event, order an Appraisal (which may be an
update of a prior Appraisal), the cost of which shall be paid by the Servicer
as a Servicing
6
Advance. Based upon such Appraisal, the Special Servicer shall redetermine and
report to the Paying Agent and the Trustee the amount of the Appraisal
Reduction with respect to such Mortgage Loan and such redetermined Appraisal
Reduction shall replace the prior Appraisal Reduction with respect to such
Mortgage Loan.
With respect to each Mortgage Loan as to which an Appraisal Reduction
has occurred and which has become a Corrected Mortgage Loan and has remained
current for twelve consecutive Monthly Payments (for such purposes taking into
account any amendment or modification of such Mortgage Loan), and with respect
to which no other Appraisal Reduction Event has occurred and is continuing, the
Special Servicer may within 30 days of the date of such twelfth Monthly
Payment, order an Appraisal (which may be an update of a prior Appraisal), the
cost of which shall be paid by the Servicer as a Servicing Advance. Based upon
such Appraisal, the Special Servicer shall redetermine and report to the Paying
Agent and the Trustee the amount of the Appraisal Reduction with respect to
such Mortgage Loan. Notwithstanding the foregoing, the Special Servicer will
not be required to obtain an Appraisal with respect to a Mortgage Loan which is
the subject of an Appraisal Reduction Event to the extent the Special Servicer
has obtained an Appraisal with respect to the related Mortgaged Property within
the 12-month period immediately prior to the occurrence of such Appraisal
Reduction Event. Instead, the Special Servicer may use such prior Appraisal in
calculating any Appraisal Reduction with respect to such Mortgage Loan.
Notwithstanding anything herein to the contrary, the aggregate
Appraisal Reduction related to a Mortgage Loan or the related REO Property will
be reduced to zero as of the date such Mortgage Loan is paid in full,
liquidated, repurchased or otherwise removed from the Trust Fund.
"Appraisal Reduction Amount": With respect to any Distribution Date,
an amount equal to the product of (i) ___% per annum, and (ii) the sum of all
Appraisal Reductions with respect to such Distribution Date.
"Appraisal Reduction Event": With respect to any Mortgage Loan, the
earliest of (i) the third anniversary of the date on which the first extension
of the Maturity Date of such Mortgage Loan becomes effective as a result of a
modification of such Mortgage Loan by the Special Servicer pursuant to the
terms hereof, which extension does not decrease the amount of Monthly Payments
on the Mortgage Loan, (ii) 120 days after an uncured delinquency (without
regard to the application of any grace period) occurs in respect of such
Mortgage Loan, (iii) the date on which a reduction in the amount of Monthly
Payments on such Mortgage Loan, or a change in any other material economic term
of such Mortgage Loan (other than an extension of the Maturity Date), becomes
effective as a result of a modification of such Mortgage Loan by the Special
Servicer, (iv) 60 days after a receiver has been appointed, (v) 60 days after a
Mortgagor declares bankruptcy and (vi) immediately after a Mortgage Loan
becomes an REO Loan; provided, however, that an Appraisal Reduction Event shall
not occur at any time when the aggregate Certificate Balances of all Classes of
Certificates (other than the Class [A] Certificates) has been reduced to zero.
The Special Servicer shall notify the Servicer promptly upon the occurrence of
any of the foregoing events.
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"Appraised Value": With respect to any Mortgaged Property, the
appraised value thereof as determined by an Appraisal of the Mortgaged Property
securing such Mortgage Loan made by an Independent MAI appraiser selected by
the Servicer or Special Servicer, as applicable.
"Asset Status Report": As defined in Section 3.21(e).
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents and profits or similar instrument executed by the
Mortgagor, assigning to the mortgagee all of the income, rents and profits
derived from the ownership, operation, leasing or disposition of all or a
portion of such Mortgaged Property, in the form which was duly executed,
acknowledged and delivered, as amended, modified, renewed or extended through
the date hereof and from time to time hereafter.
"Assumed Scheduled Payment": For any Due Period and with respect to
any Mortgage Loan that is delinquent in respect of its Balloon Payment
(including any REO Loan as to which the Balloon Payment would have been past
due), an amount equal to the sum of (a) the principal portion of the Monthly
Payment that would have been due on such Mortgage Loan on the related Due Date
based on the constant payment required by the related Mortgage Note or the
original amortization schedule thereof (as calculated with interest at the
related Mortgage Rate), if applicable, assuming such Balloon Payment has not
become due, after giving effect to any modification of such Mortgage Loan, and
(b) interest on the Stated Principal Balance of such Mortgage Loan at the
applicable Mortgage Rate (net of interest at the Servicing Fee Rate).
"Authenticating Agent": Any agent of the Trustee appointed to act as
Authenticating Agent pursuant to Section 5.01.
"Available Distribution Amount": With respect to any Distribution
Date, an amount equal to the sum of (without duplication):
(a) the aggregate amount relating to the Trust Fund on deposit in the
Certificate Account and the Lower-Tier Distribution Account (exclusive of any
investment income contained therein) as of the close of business on the
Business Day preceding the related P&I Advance Date, exclusive of:
(i) all Monthly Payments paid by the Mortgagors that are due
on a Due Date following the end of the related Due Period;
(ii) all Principal Prepayments (together with any related
payments of interest allocable to the period following the Due Date
for the related Mortgage Loan during the related Due Period), Balloon
Payments, Liquidation Proceeds or Insurance and Condemnation Proceeds
received after the end of the related Due Period;
(iii) all amounts payable or reimbursable to any Person from
the Certificate Account pursuant to clauses (ii)-(xvi), inclusive, of
Section 3.05(a);
8
(iv) all amounts payable or reimbursable to any Person from
the Lower-Tier Distribution Account pursuant to clauses (ii)-(v),
inclusive, of Section 3.05(b);
(v) all Prepayment Premiums and Yield Maintenance Charges;
and
(vi) all amounts deposited in the Certificate Account or the
Lower-Tier Distribution Account, as the case may be, in error;
(b) if and to the extent not already included in clause (a) hereof,
the aggregate amount transferred from the REO Account to the Certificate
Account for such Distribution Date pursuant to Section 3.16(c); and
(c) the aggregate amount of any P&I Advances made by the Servicer, the
Trustee or the Fiscal Agent, as applicable, for such Distribution Date pursuant
to Section 4.03 or 7.05 (net of the related Trustee Fee with respect to the
Mortgage Loans for which such P&I Advances are made).
Notwithstanding the investment of funds held in the Certificate
Account or the Lower-Tier Distribution Account pursuant to Section 3.06, for
purposes of calculating the Available Distribution Amount, the amounts so
invested shall be deemed to remain on deposit in such account.
"Balloon Mortgage Loan": Any Mortgage Loan that by its original terms
or by virtue of any modification entered into as of the Closing Date provides
for an amortization schedule extending beyond its Maturity Date.
"Balloon Payment": With respect to any Balloon Mortgage Loan as of any
date of determination, the Monthly Payment payable on the Maturity Date of such
Mortgage Loan.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time
to time (Title 11 of the United States Code).
"Base Interest Fraction": With respect to any Principal Prepayment on
any Mortgage Loan and with respect to any of the Class [A], Class [B], Class
[C], Class [D] and Class [E] Certificates, a fraction (A) whose numerator is
the greater of (x) zero and (y) the difference between (i) the Pass-Through
Rate on such Class of Offered Certificates and (ii) the Yield Rate, with
respect to Mortgage Loans sold to the Depositor by __________________, or the
Discount Rate, with respect to Mortgage Loans sold to the Depositor by
_______________, used in calculating the Yield Maintenance Charge with respect
to such Principal Prepayment and (B) whose denominator is the difference
between (i) the Mortgage Rate on the related Mortgage Loan and (ii) the Yield
Rate, with respect to Mortgage Loans sold to the Depositor by _______________,
or the Discount Rate, with respect to Mortgage Loans sold to the Depositor by
_______________, used in calculating the Yield Maintenance Charge with respect
to such principal prepayment; provided however, that under no circumstances
shall the Base Interest Fraction be greater than one. If such Yield Rate or
Discount Rate, as the case may be, is greater
9
than the Mortgage Rate on the related Mortgage Loan, then the Base Interest
Fraction shall equal zero.
"Book-Entry Certificate": Any Certificate registered in the name of
the Depository or its nominee.
"Breach": As defined in Section 2.03(b).
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking institutions in New York, New York, or the city and state in
which the Corporate Trust Office of the Trustee or principal place of business
of the Servicer or the Special Servicer is located, are authorized or obligated
by law or executive order to remain closed.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"Certificate": Any one of the Depositor's Commercial Mortgage
Pass-Through Certificates, Series 1998-___, as executed and delivered by the
Certificate Registrar and authenticated and delivered hereunder by the
Authenticating Agent.
"Certificate Account": The custodial account or accounts created and
maintained by the Servicer pursuant to Section 3.04(a) in the name of the
Trustee on behalf of the Certificateholders, into which the amounts set forth
in Section 3.04(a) shall be deposited directly. Any such account or accounts
shall be an Eligible Account.
"Certificate Balance": With respect to any Class of Certificates
(other than the Residual Certificates and the Class [X] Certificates), (i) on
or prior to the first Distribution Date, an amount equal to the Original
Certificate Balance of such Class as specified in the Preliminary Statement
hereto, and (ii) as of any date of determination after the first Distribution
Date, the Certificate Balance of such Class on the Distribution Date
immediately prior to such date of determination (determined as adjusted
pursuant to Section 1.02(iii)).
"Certificate Deferred Interest": For any Distribution Date with
respect to any Class of Certificates, the amount of Mortgage Deferred Interest
allocated to such Class pursuant to Section 4.06(a).
"Certificate Factor": With respect to any Class of Certificates, as of
any date of determination, a fraction, expressed as a decimal carried to 8
places, the numerator of which is the then related Certificate Balance, and the
denominator of which is the related Original Certificate Balance.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, provided, however, that
solely for the purposes of giving any consent, approval or waiver pursuant to
this Agreement, any Certificate registered in the name of the Servicer, the
Special Servicer, the Depositor or any Affiliate of either shall be deemed not
to be outstanding, and the Voting Rights to which it is entitled shall not be
taken into
10
account in determining whether the requisite percentage of Voting Rights
necessary to effect any such consent, approval or waiver has been obtained, if
such consent, approval or waiver sought from such party would in any way
increase its compensation or limit its obligations as Servicer, Special
Servicer or Depositor, as applicable, hereunder; provided, however, the
Servicer and Special Servicer shall be entitled to exercise such Voting Rights
with respect to any issue which could reasonably be believed to adversely
affect such party's compensation or increase its obligations or liabilities
hereunder; and provided further, however, that such restrictions will not apply
to the exercise of the Special Servicer's rights as a member of the Controlling
Class. The Trustee shall be entitled to request and rely upon a certificate of
the Servicer, the Special Servicer or the Depositor in determining whether a
Certificate is registered in the name of an Affiliate of such Person. All
references herein to "Holders" or "Certificateholders" shall reflect the rights
of Certificate Owners as they may indirectly exercise such rights through the
Depository and the Depository Participants, except as otherwise specified
herein; provided, however, that the parties hereto shall be required to
recognize as a "Holder" or "Certificateholder" only the Person in whose name a
Certificate is registered in the Certificate Register.
"Certificate Owner": With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate as reflected on the
books of the Depository or on the books of a Depository Participant or on the
books of an indirect participating brokerage firm for which a Depository
Participant acts as agent.
"Certificate Rating": With respect to the long-term unsecured debt of
any institution, a long-term debt obligation rating by each Rating Agency not
lower than the highest rating by such Rating Agency of any Class of
Certificates then outstanding; provided, however, that the Certificate Rating
will not be lower than Investment Grade by such Rating Agency.
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02.
"Class": With respect to any Certificates or Uncertificated Lower-Tier
Interests, all of the Certificates or Uncertificated Lower-Tier Interests
bearing the same alphabetical (and, if applicable, numerical) Class
designation.
"Class [A] Certificate": Any Class [A-1] or Class [A-2] Certificate.
"Class [A-1] Certificate": A Certificate designated as "Class [A-1]"
on the face thereof, in the form of Exhibit A-1 hereto.
"Class [A-1] Pass-Through Rate": With respect to any Distribution
Date, a fixed rate per annum equal to ___%.
"Class [A-2] Certificate": A Certificate designated as "Class [A-2]"
on the face thereof, in the form of Exhibit A-2 hereto.
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"Class [A-2] Pass-Through Rate": With respect to any Distribution
Date, a fixed rate per annum equal to ___%.
"Class [B] Certificate": A Certificate designated as "[Class B]" on
the face thereof, in the form of Exhibit A-3 hereto.
"Class [B] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class [C] Certificate": A Certificate designated as "[Class C]" on
the face thereof, in the form of Exhibit A-4 hereto.
"Class [C] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class D Certificate": A Certificate designated as "[Class D]" on the
face thereof, in the form of Exhibit A-5 hereto.
"Class [D] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class [E] Certificate": A Certificate designated as "[Class E]" on
the face thereof, in the form of Exhibit A-6 hereto.
"Class [E] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class [F] Certificate": A Certificate designated as "[Class F]" on
the face thereof, in the form of Exhibit A-7 hereto.
"Class [F] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class [G] Certificate": A Certificate designated as "[Class G]" on
the face thereof, in the form of Exhibit A-8 hereto.
"Class [G] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___%.
"Class [H] Certificate": A Certificate designated as "[Class H]" on
the face thereof, in the form of Exhibit A-9 hereto.
"Class [H] Pass-Through Rate": With respect to any Distribution Date,
a fixed rate per annum equal to ___ %.
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"Class [LA-1] Interest Fraction": With respect to any Distribution
Date, a fraction, the numerator of which is the [A-1] Component Interest
Accrual Amount and the denominator of which is the sum of the [A-1] Component
Interest Accrual Amount and the WAC Component Interest Accrual Amount.
"Class [LA-1] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LA-2] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LB] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LC] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LD] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LE] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LF] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LG] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LH] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the Original Lower-Tier Principal Amount and per annum rate of interest set
forth in the Preliminary Statement hereto.
"Class [LR] Certificate": A Certificate designated as "Class [LR]" on
the face thereof, in the form of Exhibit A-12 hereto.
"Class [LWAC] Notional Amount": As of any Distribution Date, an amount
equal to the aggregate Stated Principal Balances of the Mortgage Loans as of
the preceding Distribution Date
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(after giving effect to the distribution of principal and realized losses on
such Distribution Date), or the Cut-off Date in the case of the first
Distribution Date.
"Class [LWAC] Pass-Through Rate": For any Distribution Date, the
Weighted Average Net Mortgage Rate for such Distribution Date minus ___%.
"Class [LWAC] Uncertificated Interest": A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and having
the initial Notional Amount and per annum rate of interest set forth in the
Preliminary Statement hereto, representing a "specified portion" (within the
meaning of Treasury Regulations Section 1.860G-l(a)(2)(i)(C)) of the interest
payments on the Mortgage Loans.
"Class [R] Certificate": A Certificate designated as "Class [R]" on
the face thereof, in the form of Exhibit A-11 hereto.
"Class Unpaid Interest Shortfall": As to any Distribution Date and any
Class of Regular Certificates, the excess, if any, of (a) the sum of (i) the
Distributable Certificate Interest in respect of such Class for the immediately
preceding Distribution Date and (ii) any outstanding Class Unpaid Interest
Shortfall payable to such Class on such preceding Distribution Date over (b)
the aggregate amount in respect of interest actually distributed to such Class
on such immediately preceding Distribution Date. The Class Unpaid Interest
Shortfall with respect to any Class of Certificates as of the initial
Distribution Date is zero. No interest shall accrue on Class Unpaid Interest
Shortfalls.
"Class [X] Certificate": A Certificate designated as "Class [X]" on
the face thereof, in the form of Exhibit A-10 hereto.
"Class [X] Interest Accrual Amount": With respect to any Distribution
Date, the sum of the A-1 Component Interest Accrual Amount and the WAC
Component Interest Accrual Amount.
"Closing Date": _________________, 1998.
"Code": The Internal Revenue Code of 1986, as amended from time to
time, and applicable final or temporary regulations of the U.S. Department of
the Treasury issued pursuant thereto.
"Collateral Support Deficit": As defined in Section 4.04.
"Collection Report": The monthly report to be prepared by the Servicer
and delivered to the Trustee, the Paying Agent, the Special Servicer, the
Depositor and each Rating Agency pursuant to Section 4.02(b), in writing and in
electronic medium, in form reasonably acceptable to the Paying Agent,
containing such information as is set forth in Section 4.02(b) regarding the
Mortgage Loans and such other information as will permit the Paying Agent to
calculate the amounts to be distributed pursuant to Section 4.01 and to furnish
statements to Certificateholders
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pursuant to Section 4.02 and containing such additional information as the
Servicer, the Special Servicer and the Paying Agent may from time to time
agree.
"Commission": The Securities and Exchange Commission.
"Component": The A-1 Component or the WAC Component.
"Controlling Class": As of any date of determination, the most
subordinate Class of Regular Certificates then outstanding that has a then
aggregate Certificate Balance at least equal to the lesser of (a) 1% of the
outstanding aggregate principal balance of the Mortgage Loans as of the Closing
Date or (b) 20% of the initial Certificate Balance of such Class in the case of
Class [H] Certificates, or 25% of the initial Certificate Balance of such Class
in the case of any other Class of Certificates. For purposes of determining the
identity of the Controlling Class, the Certificate Balance of each Class shall
be deemed to be reduced by the amount allocated to such Class of any Appraisal
Reductions relating to Mortgage Loans as to which Liquidation Proceeds or other
final payment has not yet been received. As of the Closing Date, the
Controlling Class will be the Class [H] Certificates.
"Controlling Class Certificateholders": Each Holder (or Certificate
Owner, if applicable) of a Certificate of the Controlling Class as certified by
the Certificate Registrar to the Trustee from time to time by such Holder (or
Certificate Owner).
"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of
the execution of this Agreement is located at , Attention: _______________,
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., Series 1998-_ (telecopy
number ______________).
"Corrected Mortgage Loan": Any Specially Serviced Mortgage Loan that
has become current and remained current for three consecutive Monthly Payments
(for such purposes taking into account any modification or amendment of such
Mortgage Loan) and (provided that no additional default is foreseeable in the
reasonable judgment of the Special Servicer) the Special Servicer has returned
servicing of such Mortgage Loan to the Servicer pursuant to Section 3.21(a).
"Credit File": Any documents, other than documents required to be part
of the related Mortgage File, in the possession of the Servicer and relating to
the origination and servicing of any Mortgage Loan.
"Custodian": A Person who is at any time appointed by the Trustee
pursuant to Section 8.11 as a document custodian for the Mortgage Files, which
Person shall not be the Depositor, either Mortgage Loan Seller or an Affiliate
of any of them. The Trustee shall be the initial Custodian.
"Cut-off Date": __________, 1998.
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"Cut-off Date Principal Balance": With respect to any Mortgage Loan,
the outstanding principal balance of such Mortgage Loan as of the Cut-off Date,
after application of all payments of principal due on or before such date,
whether or not received.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan for
any twelve month period covered by an annual operating statement for the
related Mortgaged Property, the ratio of (i) Net Operating Income produced by
the related Mortgaged Property during such period to (ii) the aggregate amount
of Monthly Payments (other than any Balloon Payment) due under such Mortgage
Loan during such period, provided, that with respect to the Mortgage Loans
which initially pay interest only, the related Monthly Payment will be
calculated (for purposes of this definition only) to include principal (based
upon a 25-year amortization schedule) and interest payments from origination.
"Default Interest": With respect to any defaulted Mortgage Loan for
any related Due Period, all interest accrued in respect of such Mortgage Loan
during such Due Period provided for in the related Mortgage Note or Mortgage as
a result of the related default (exclusive of late payment charges) that is in
excess of interest at the related Mortgage Rate accrued on the unpaid principal
balance of such Mortgage Loan outstanding from time to time during such Due
Period.
"Defaulted Mortgage Loan": A Mortgage Loan that is delinquent at least
sixty days in respect of its Monthly Payments or more than thirty days
delinquent in respect of its Balloon Payment, if any, in either case such
delinquency to be determined without giving effect to any grace period
permitted by the related Mortgage or Mortgage Note and without regard to any
acceleration of payments under the related Mortgage and Mortgage Note.
"Defaulting Party": As defined in Section 7.01(b).
"Defect": As defined in Section 2.02(e).
"Deficient Valuation": With respect to any Mortgage Loan, a valuation
by a court of competent jurisdiction of the Mortgaged Property in an amount
less than the then outstanding principal balance of the Mortgage Loan, which
valuation results from a proceeding initiated under the Bankruptcy Code.
"Definitive Certificate": As defined in Section 5.01(a).
"Denomination": As defined in Section 5.01(a).
"Depositor": Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., a
Delaware corporation, or its successor in interest.
"Depository": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository for purposes
of registering those Certificates that are to be Book-Entry Certificates, is
Cede & Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform Commercial Code of the State of
16
New York and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Exchange Act.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Depository Rules": As defined in Section 5.02(b).
"Determination Date": With respect to any Distribution Date, the __th
day of the month in which such Distribution Date occurs, or if such __th day is
not a Business Day, the immediately preceding Business Day.
"Directing Certificateholder": The Controlling Class Certificateholder
selected by more than 50% of the Controlling Class Certificateholders, by
Certificate Balance, as certified by the Certificate Registrar from time to
time; provided, however, that (i) absent such selection, or (ii) until a
Directing Certificateholder is so selected or (iii) upon receipt of a notice
from a majority of the Controlling Class Certificateholders, by Certificate
Balance, that a Directing Certificateholder is no longer designated, the
Controlling Class Certificateholder that owns the largest aggregate Certificate
Balance of the Controlling Class will be the Directing Certificateholder.
"Directly Operate": With respect to any REO Property, the furnishing
or rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale to
customers, the performance of any construction work thereon or any use of such
REO Property in a trade or business conducted by the Trust Fund other than
through an Independent Contractor; provided, however, that the Trustee (or the
Special Servicer on behalf of the Trustee) shall not be considered to Directly
Operate an REO Property solely because the Trustee (or the Special Servicer on
behalf of the Trustee) establishes rental terms, chooses tenants, enters into
or renews leases, deals with taxes and insurance or makes decisions as to
repairs or capital expenditures with respect to such REO Property.
"Discount Rate": A rate which, when compounded monthly, is equivalent
to the Yield Rate when compounded semi-annually.
"Disqualified Organization": Any of (i) the United States, any State
or political subdivision thereof, any possession of the United States or any
agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and a majority of its board of directors is not selected by such
governmental unit), (ii) a foreign government, any international organization
or any agency or instrumentality of any of the foregoing, (iii) any
organization (other than certain farmers' cooperatives described in Section 521
of the Code) which is exempt from the tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Section 1381(a)(2)(C) of the Code and (v) any other Person so designated by the
Servicer based upon an Opinion of Counsel that the holding of an Ownership
Interest in a Residual Certificate by such Person may cause either the
17
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or any
Person having an Ownership Interest in any Class of Certificates (other than
such Person) to incur a liability for any federal tax imposed under the Code
that would not otherwise be imposed but for the Transfer of an Ownership
Interest in a Residual Certificate to such Person. The terms "United States",
"State" and "international organization" shall have the meanings set forth in
Section 7701 of the Code or successor provisions.
"Distributable Certificate Interest": With respect to any Distribution
Date, as to any Class of Regular Certificates, the Accrued Certificate Interest
in respect of such Class of Regular Certificates for such Distribution Date,
reduced (to not less than zero) by any allocations to such Class of
Certificates (other than in the case of the Class [X] Certificates) of any
Certificate Deferred Interest for such Distribution Date.
"Distribution Accounts": Collectively, the Upper-Tier Distribution
Account and the Lower-Tier Distribution Account.
"Distribution Date": The __th day of any month, or if such __th day is
not a Business Day, the Business Day immediately following, commencing in
__________ 1998.
"Distribution Date Statement": As defined in Section 4.02(a).
"Due Date": With respect to (i) any Mortgage Loan on or prior to its
Maturity Date, the day of the month set forth in the related Mortgage Note on
which each Monthly Payment thereon is scheduled to be first due, (ii) any
Mortgage Loan after the Maturity Date therefor, the day of the month set forth
in the related Mortgage Note on which each Monthly Payment on such Mortgage
Loan had been scheduled to be first due, and (iii) any REO Loan, the day of the
month set forth in the related Mortgage Note on which each Monthly Payment on
the related Mortgage Loan had been scheduled to be first due.
"Due Period": With respect to any Distribution Date, the period
commencing on the second day of the month preceding the month in which such
Distribution Date occurs and ending on the first day of the month in which such
Distribution Date occurs. Notwithstanding the foregoing, in the event that the
last day of a Due Period is not a Business Day, any payments received with
respect to the Mortgage Loans relating to such Due Period on the Business Day
immediately following such day shall be deemed to have been received during
such Due Period and not during any other Due Period.
"Eligible Account": Either (i) an account or accounts maintained with
a federal or state chartered depository institution or trust company the
long-term unsecured debt obligations of which are rated at least "AA--" by
_______________ and _______________, or, if not rated by _______________, at
least "A" or its equivalent by another nationally recognized statistical rating
agency, if the deposits are to be held in such account for more than 30 days or
the short-term debt obligations of which have a short-term rating of not less
than "A-1" from _______________ and "D-1+" from (if rated by _______________)
if the deposits are to be held in such account for less than 30 days, or such
other account or accounts with respect to which each of the Rating Agencies
shall have confirmed in writing that the then current rating
18
assigned to any of the Certificates that are currently being rated by such
Rating Agency will not be qualified, downgraded or withdrawn by reason thereof
or (ii) a segregated trust account or accounts maintained with the corporate
trust department of a federal or state chartered depository institution or
trust company that, in either case, has a combined capital and surplus of at
least $50,000,000 and has corporate trust powers, acting in its fiduciary
capacity, provided that any state chartered depository institution or trust
company is subject to regulation regarding fiduciary funds substantially
similar to 12 C.F.R. ss. 9.10(b). Eligible Accounts may bear interest. No
Eligible Account shall be evidenced by a certificate of deposit, passbook or
other similar instrument.
"Eligible Investor": Either (i) a Qualified Institutional Buyer that
is purchasing for its own account or for the account of a Qualified
Institutional Buyer to whom notice is given that the offer, sale or transfer is
being made in reliance on Rule 144A or (ii) an Institutional Accredited
Investor.
"Environmental Assessment": A "Phase I assessment" as described in,
and meeting the criteria of, (i) Chapter 5 of the FNMA Multifamily Guide or any
successor provisions covering the same subject matter, in the case of Specially
Serviced Mortgage Loans as to which the related Mortgaged Property is
multifamily property or (ii) the American Society for Testing and Materials in
the case of Specially Serviced Mortgage Loans as to which the related Mortgaged
Property is a non-multifamily property.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Prohibited Holder": As defined in Section 5.02(d).
"Escrow Payment": Any payment received by the Servicer for the account
of any Mortgagor for application toward the payment of real estate taxes,
assessments, insurance premiums and similar items in respect of the related
Mortgaged Property, including amounts for deposit to any reserve account.
"Event of Default": One or more of the events described in Section
7.01(a).
"Exchange Act": The Securities Exchange Act of 1934, as amended from
time to time.
"Extension Adviser": As defined in Section 3.26(a).
"FDIC": Federal Deposit Insurance Corporation or any successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor.
"Final Recovery Determination": A determination by the Special
Servicer with respect to any Defaulted Mortgage Loan or REO Property (other
than a Mortgage Loan or REO Property, as the case may be, that was purchased by
a Mortgage Loan Seller pursuant to Section 3 of the related Mortgage Loan
Purchase Agreement, by the Servicer or the Special Servicer pursuant to Section
3.18(b), or by the Servicer, the Special Servicer, the Holders of the
19
Controlling Class or the Holders of the Class [LR] Certificates pursuant to
Section 9.01) that there has been a recovery of all Insurance and Condemnation
Proceeds, Liquidation Proceeds and other payments or recoveries that, in the
Special Servicer's judgment, exercised without regard to any obligation of the
Special Servicer to make payments from its own funds pursuant to Section
3.07(b), will ultimately be recoverable.
"FNMA": Federal National Mortgage Association or any successor thereto.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes or substances, including, without limitation, those so
identified pursuant to CERCLA or any other federal, state or local
environmental related laws and regulations, and specifically including, without
limitation, asbestos and asbestos-containing materials, polychlorinated
biphenyls, radon gas, petroleum and petroleum products, urea formaldehyde and
any substances classified as being "in inventory," "usable work in process" or
similar classification which would, if classified as unusable, be included in
the foregoing definition.
"Independent": When used with respect to any specified Person, any
such Person who (i) is in fact independent of the Depositor, the Servicer, the
Special Servicer and any and all Affiliates thereof, (ii) does not have any
material direct financial interest in or any material indirect financial
interest in any of the Depositor, the Servicer, the Special Servicer or any
Affiliate thereof and (iii) is not connected with the Depositor, the Servicer,
the Special Servicer or any Affiliate thereof as an officer, employee,
promoter, underwriter, trustee, partner, director or Person performing similar
functions; provided, however, that a Person shall not fail to be Independent of
the Depositor, the Servicer, the Special Servicer or any Affiliate thereof
merely because such Person is the beneficial owner of 1% or less of any Class
of securities issued by the Depositor, the Servicer, the Special Servicer or
any Affiliate thereof, as the case may be.
"Independent Contractor": Either (i) any Person that would be an
"independent contractor" with respect to the Trust within the meaning of
Section 856(d)(3) of the Code if the Trust were a real estate investment trust
(except that the ownership test set forth in that Section shall be considered
to be met by any Person that owns, directly or indirectly, 35% or more of any
Class of Certificates, or such other interest in any Class of Certificates as
is set forth in an Opinion of Counsel, which shall be at no expense to the
Trustee, the Servicer or the Trust, delivered to the Trustee and the Servicer),
so long as the Trust does not receive or derive any income from such Person and
provided that the relationship between such Person and the Trust is at arm's
length, all within the meaning of Treasury Regulation Section 1.856-4(b)(5)
(except that the Servicer or the Special Servicer shall not be considered to be
an Independent Contractor under the definition in this clause (i) unless an
Opinion of Counsel has been delivered to the Trustee to that effect) or (ii)
any other Person (including the Servicer and the Special Servicer) upon receipt
by the Trustee and the Servicer of an Opinion of Counsel, which shall be at no
expense to the Trustee, the Servicer or the Trust Fund, to the effect that the
taking of any action in respect of any REO Property by such Person, subject to
any conditions therein specified, that is otherwise herein contemplated to be
taken by an Independent Contractor will not cause such REO Property to cease to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code or cause any income realized in respect of such REO Property to fail
to qualify as Rents from Real Property.
20
"Institutional Accredited Investor": As defined in Section 5.02(b).
"Insurance Policy": With respect to any Mortgage Loan, any hazard
insurance policy, flood insurance policy, title policy or other insurance
policy that is maintained from time to time in respect of such Mortgage Loan or
the related Mortgaged Property.
"Insurance and Condemnation Proceeds": All proceeds paid under any
Insurance Policy or in connection with the full or partial condemnation of a
Mortgaged Property, in either case, to the extent such proceeds are not applied
to the restoration of the related Mortgaged Property or released to the
Mortgagor, in either case, in accordance with the Servicing Standards.
"Interest Accrual Period": With respect to any Class of Regular
Certificates or Uncertificated Lower-Tier Interests and any Distribution Date,
the period beginning on the first day of the calendar month preceding the
calendar month in which the related Distribution Date occurs and ending on the
last day of the calendar month preceding the calendar month in which such
Distribution Date occurs.
"Interest Distribution Amount": With respect to any Class of Regular
Certificates for any Distribution Date, an amount equal to the sum of the
Distributable Certificate Interest and the Class Unpaid Interest Shortfall with
respect to such Class of Regular Certificates for such Distribution Date.
"Interested Person": The Depositor, the Servicer, the Special
Servicer, any Independent Contractor engaged by the Special Servicer, any
Holder of a Certificate or any Affiliate of any such Person.
"Investment Account": As defined in Section 3.06(a).
"Investment Grade": With respect to any Certificate, ratings assigned
to such Certificate by and no lower than "BBB--".
"Investment Representation Letter": As defined in Section 5.02(b).
"Issue Price": With respect to each Class of Certificates, the "issue
price" as defined in the REMIC Provisions.
"Late Collections": With respect to any Mortgage Loan, all amounts
received thereon during any Due Period, whether as payments, Insurance and
Condemnation Proceeds, Liquidation Proceeds or otherwise, which represent late
payments or collections of principal or interest due in respect of such
Mortgage Loan (without regard to any acceleration of amounts due thereunder by
reason of default) on a Due Date in a previous Due Period and not previously
recovered. With respect to any REO Loan, all amounts received in connection
with the related REO Property during any Due Period, whether as Insurance and
Condemnation Proceeds, Liquidation Proceeds, REO Revenues or otherwise, which
represent late collections of principal or interest due or deemed due in
respect of such REO Loan or the predecessor Mortgage Loan (without regard to
any acceleration of amounts due under the predecessor Mortgage Loan by
21
reason of default) on a Due Date in a previous Due Period and not previously
recovered. The term "Late Collections" shall specifically exclude Penalty
Charges.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made with respect to such Mortgage Loan; (iii) such Mortgage
Loan is repurchased by a Mortgage Loan Seller pursuant to Section 3 of the
related Mortgage Loan Purchase Agreement; (iv) such Mortgage Loan is purchased
by the Servicer or the Special Servicer pursuant to Section 3.18(b); or (v)
such Mortgage Loan is purchased by the Servicer, the Special Servicer, the
Holders of the Controlling Class or the Holders of the Class [LR] Certificates
pursuant to Section 9.01. With respect to any REO Property (and the related REO
Loan), any of the following events: (i) a Final Recovery Determination is made
with respect to such REO Property or (ii) such REO Property is purchased by the
Servicer, the Special Servicer, the Holders of the Controlling Class or the
Holders of the Class [LR] Certificates pursuant to Section 9.01.
"Liquidation Fee": A fee payable to the Special Servicer with respect
to each Specially Serviced Mortgage Loan as to which the Special Servicer
receives a full or discounted payoff with respect thereto from the related
Mortgagor or any Liquidation Proceeds with respect thereto, equal to the
product of the Liquidation Fee Rate and the proceeds of such full or discounted
payoff or the net Liquidation Proceeds (net of the related costs and expenses
associated with the related liquidation) related to such liquidated Specially
Serviced Mortgage Loan, as the case may be; provided, however, that no
Liquidation Fee shall be payable with respect to clauses (iii) - (v) of the
definition of Liquidation Proceeds.
"Liquidation Fee Rate": A rate equal to ___%.
"Liquidation Proceeds": Cash amounts (other than Insurance and
Condemnation Proceeds and REO Revenues) received or paid by the Servicer in
connection with: (i) the liquidation of a Mortgaged Property or other
collateral constituting security for a defaulted Mortgage Loan, through
trustee's sale, foreclosure sale, REO Disposition or otherwise, exclusive of
any portion thereof required to be released to the related Mortgagor in
accordance with applicable law and the terms and conditions of the related
Mortgage Note and Mortgage; (ii) the realization upon any deficiency judgment
obtained against a Mortgagor; (iii) the purchase of a Defaulted Mortgage Loan
by the Servicer or the Special Servicer pursuant to Section 3.18(b) or any
other sale thereof pursuant to Section 3.18(c); (iv) the repurchase of a
Mortgage Loan by a Mortgage Loan Seller pursuant to Section 3 of the related
Mortgage Loan Purchase Agreement; or (v) the purchase of a Mortgage Loan or REO
Property by the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates pursuant to Section 9.01.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any
date of determination, the fraction, expressed as a percentage, the numerator
of which is the scheduled principal balance of such Mortgage Loan at the time
of determination, and the denominator of which is the Original Value of the
related Mortgaged Property.
"Lower-Tier Distribution Account": The segregated account or accounts
created and maintained by the Paying Agent pursuant to Section 3.04(b) in trust
for the Certificateholders,
22
which shall be entitled "________________, as Paying Agent, in trust for the
registered Holders of Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-_, Lower-Tier
Distribution Account". Any such account or accounts shall be an Eligible
Account.
"Lower-Tier Distribution Amount": As defined in Section 4.01(b).
"Lower-Tier Principal Amount": With respect to any Class of
Uncertificated Lower-Tier Interests (other than the Class [LWAC] Uncertificated
Interest), (i) on or prior to the first Distribution Date, an amount equal to
the Original Lower-Tier Principal Amount of such Class as specified in the
Preliminary Statement hereto, and (ii) as of any date of determination after
the first Distribution Date, an amount equal to the Certificate Balance of the
Class of Related Certificates on the Distribution Date immediately prior to
such date of determination (determined as adjusted pursuant to Section
1.02(iii)).
"Lower-Tier REMIC": One of two separate REMICs comprising the Trust
Fund, the assets of which consist of the Mortgage Loans, any REO Property with
respect thereto, such amounts as shall from time to time be held in the
Certificate Account, the REO Account, if any, and the Lower-Tier Distribution
Account, and all other property included in the Trust Fund that is not in the
Upper-Tier REMIC.
"MAI": Member of the Appraisal Institute.
"Maturity Date": With respect to any Mortgage Loan as of any date of
determination, the date on which the last payment of principal is due and
payable under the related Mortgage Note, after taking into account all
Principal Prepayments received prior to such date of determination, but without
giving effect to (i) any acceleration of the principal of such Mortgage Loan by
reason of default thereunder, (ii) any grace period permitted by the related
Mortgage Note, or (iii) any modification, waiver or amendment of such Mortgage
Loan granted or agreed to by the Servicer or the Special Servicer pursuant to
Section 3.20 occurring prior to such date of determination.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and/or interest on such Mortgage Loan, including
any Balloon Payment, which is payable by a Mortgagor from time to time under
the related Mortgage Note and applicable law, without regard to any
acceleration of principal of such Mortgage Loan by reason of default thereunder
or any modification, waiver or amendment of such Mortgage Loan granted or
agreed to by the Servicer or the Special Servicer pursuant to Section 3.20.
"Mortgage": With respect to any Mortgage Loan, the mortgage, deed of
trust or other instrument securing a Mortgage Note and creating a lien on the
related Mortgaged Property.
"Mortgage Deferred Interest": With respect to any Mortgage Loan as of
any Due Date that has been modified to reduce the rate at which interest is
paid currently below the Mortgage Rate, the excess, if any, of (a) interest
accrued on the Stated Principal Balance thereof during the one-month interest
accrual period set forth in the related Mortgage Note at the related
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Mortgage Rate over (b) the interest portion of the related Monthly Payment or,
if applicable, Assumed Scheduled Payment due on such Due Date.
"Mortgaged Property": The real property subject to the lien of a
Mortgage.
"Mortgage File": With respect to any Mortgage Loan, collectively the
following documents:
(i) the original Mortgage Note, bearing, or accompanied by,
all prior and intervening endorsements or assignments showing a
complete chain of endorsement or assignment from the originator of the
Mortgage Loan to the Mortgage Loan Seller, and further endorsed (at
the direction of the Depositor given pursuant to the Mortgage Loan
Purchase Agreement) by the Mortgage Loan Seller, on its face or by
allonge attached thereto, without recourse, to the order of the
Trustee in the following form: "Pay to the order of _______________,
as trustee for the registered Holders of Bear ▇▇▇▇▇▇▇ Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-___, without recourse, representation or
warranty, express or implied";
(ii) the original Mortgage (or a certified copy thereof from
the applicable recording office) and originals (or certified copies
from the applicable recording office) of any intervening assignments
thereof showing a complete chain of assignment from the originator of
the Mortgage Loan to the Mortgage Loan Seller, in each case with
evidence of recording indicated thereon;
(iii) an original (or a copy if the original has been sent by
the Servicer for recordation) assignment of the Mortgage, in
recordable form, from the Mortgage Loan Seller to "_______________, as
trustee for the registered Holders of Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
1998-___";
(iv) an original or copy of any related Assignment of Leases
(if such item is a document separate from the Mortgage) and the
originals or copies of any intervening assignments thereof showing a
complete chain of assignment from the originator of the Mortgage Loan
to the Mortgage Loan Seller, in each case with evidence of recording
thereon;
(v) an original assignment of any related Assignment of
Leases (if such item is a document separate from the Mortgage), in
recordable form, executed by the Mortgage Loan Seller in favor of the
Trustee (in such capacity);
(vi) an original or copy of any related Security Agreement
(if such item is a document separate from the Mortgage) and the
originals or copies of any intervening assignments thereof showing a
complete chain of assignment from the originator of the Mortgage Loan
to the Mortgage Loan Seller;
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(vii) an original assignment of any related Security
Agreement (if such item is a document separate from the Mortgage), in
recordable form, executed by the Mortgage Loan Seller in favor of the
Trustee (in such capacity);
(viii) originals or copies of all assumption, modification,
written assurance and substitution agreements, with evidence of
recording thereon, where appropriate, in those instances where the
terms or provisions of the Mortgage, Mortgage Note or any related
security document have been modified or the Mortgage Loan has been
assumed;
(ix) the original lender's title insurance policy or a copy
thereof effective as of the date of the recordation of the Mortgage
Loan, together with all endorsements or riders that were issued with
or subsequent to the issuance of such policy, insuring the priority of
the Mortgage as a first lien on the Mortgagor's fee interest in the
Mortgaged Property, or if the policy has not yet been issued, a
written commitment or interim binder, dated as of the date the related
Mortgage Loan was funded;
(x) the original or copy of any guaranty of the obligations
of the Mortgagor under the Mortgage Loan;
(xi) all UCC Financing Statements and continuation statements
or copies thereof sufficient to perfect (and maintain the perfection
of) the security interest held by the originator of the Mortgage Loan
(and each assignee prior to the Trustee) in and to the personally of
the Mortgagor at the Mortgaged Property (in each case with evidence of
filing thereon), and to transfer such security interest to the
Trustee;
(xii) the original power of attorney (with evidence of
recording thereon) granted by the Mortgagor if the Mortgage, Mortgage
Note or other document or instrument referred to above was not signed
by the Mortgagor;
(xiii) with respect to any Mortgage Loans with Affiliate
Debt, a subordination agreement, pursuant to which such Affiliate Debt
will be fully subordinated to such Mortgage Loan; and
(xiv) any additional documents required to be added to the
Mortgage File pursuant to this Agreement; provided, however, that
whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee, or a Custodian appointed thereby,
such term shall not be deemed to include such documents and
instruments required to be included therein unless they are actually
so received.
"Mortgage Loan": Each of the mortgage loans transferred and assigned
to the Trustee pursuant to Section 2.01 and from time to time held in the Trust
Fund. As used herein, the term "Mortgage Loan" includes the related Mortgage
Note, Mortgage and other documents contained in the related Mortgage File and
any related agreements.
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"Mortgage Loan Purchase Agreement": Either of the agreements between
the Depositor and each Mortgage Loan Seller, relating to the transfer of all of
such Mortgage Loan Seller's right, title and interest in and to the related
Mortgage Loans.
"Mortgage Loan Schedule": The list of Mortgage Loans transferred on
the Closing Date to the Trustee as part of the Trust Fund, attached hereto as
Exhibit B. which list sets forth the following information with respect to each
Mortgage Loan:
(i) the loan identification number (as specified in Exhibit A
to the Prospectus);
(ii) the Mortgagor's name;
(iii) the street address (including city, state and zip code)
of the related Mortgaged Property;
(iv) the Mortgage Rate in effect at origination;
(v) the Net Mortgage Rate in effect at the Cut-off Date;
(vi) the original principal balance;
(vii) the Cut-off Date Principal Balance;
(viii) the (a) original term to stated maturity, (b)
remaining term to stated maturity and (c) Maturity Date;
(ix) the original and remaining amortization terms;
(x) the amount of the Monthly Payment due on the first Due
Date following the Cut-off Date;
(xi) the Original Value of the related Mortgaged Property;
(xii) the Loan-to-Value Ratio at the Cut-off Date;
(xiii) the Underwritten Debt Service Coverage Ratio; and
(xiv) the applicable Servicing Fee Rate.
Such Mortgage Loan Schedule shall also set forth the aggregate of the
amounts described under clause (vii) above for all of the Mortgage Loans. Such
list may be in the form of more than one list, collectively setting forth all
of the information required.
"Mortgage Loan Seller": Bear ▇▇▇▇▇▇▇ Funding Inc., a Delaware
corporation or its successor in interest.
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"Mortgage Note": The original executed note evidencing the
indebtedness of a Mortgagor under a Mortgage Loan, together with any rider,
addendum or amendment thereto.
"Mortgage Rate": With respect to: (i) any Mortgage Loan on or prior to
its Maturity Date, the annualized rate at which interest is scheduled (in the
absence of a default) to accrue on such Mortgage Loan from time to time in
accordance with the related Mortgage Note and applicable law; (ii) any Mortgage
Loan after its Maturity Date, the annualized rate described in clause (i) above
determined without regard to the passage of such Maturity Date and (iii) any
REO Loan, the annualized rate described in clause (1) or (ii), as applicable,
above determined as if the predecessor Mortgage Loan had remained outstanding.
"Mortgagor": The obligor or obligers on a Mortgage Note, including
without limitation, any Person that has acquired the related Mortgaged Property
and assumed the obligations of the original obligor under the Mortgage Note.
"Net Investment Earnings": With respect to either the Certificate
Account, the Distribution Accounts or the REO Account for any period from any
Distribution Date to the immediately succeeding P&I Advance Date, the amount,
if any, by which the aggregate of all interest and other income realized during
such period on funds relating to the Trust Fund held in such account, exceeds
the aggregate of all losses, if any, incurred during such period in connection
with the investment of such funds in accordance with Section 3.06.
"Net Investment Loss": With respect to either the Certificate Account,
the Distribution Accounts or the REO Account for any period from any
Distribution Date to the immediately succeeding P&I Advance Date, the amount by
which the aggregate of all losses, if any, incurred during such period in
connection with the investment of funds relating to the Trust Fund held in such
account in accordance with Section 3.06, exceeds the aggregate of all interest
and other income realized during such period on such funds.
"Net Mortgage Rate": With respect to any Mortgage Loan or REO Loan, as
of any date of determination, a rate per annum equal to the related Mortgage
Rate then in effect, minus the sum of (x) the Servicing Fee Rate and (y) the
Trustee Fee Rate.
"Net Operating Income": With respect to any Mortgaged Property, for
any Mortgagor's fiscal year end, the total operating revenues derived from such
Mortgaged Property during such period, minus the total operating expenses
incurred in respect of such Mortgaged Property during such period and capital
expenditure reserves, other than (i) non-cash items such as depreciation, (ii)
amortization, (iii) actual capital expenditures and (iv) debt service on the
related Mortgage Loan.
"New Lease": Any lease of REO Property entered into at the direction
of the Special Servicer on behalf of the Trust, including any lease renewed,
modified or extended on behalf of the Trust, if the Trust has the right to
renegotiate the terms of such lease.
"Nonrecoverable Advance": Any Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance.
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"Nonrecoverable P&I Advance": Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Loan which, in the
judgment of the Servicer, the Trustee or the Fiscal Agent, as applicable, will
not be ultimately recoverable, together with any accrued and unpaid interest
thereon, from Late Collections or any other recovery on or in respect of such
Mortgage Loan or REO Loan. The determination by the Servicer, the Trustee or
the Fiscal Agent, as applicable, that it has made a Nonrecoverable P&I Advance
or that any proposed P&I Advance, if made, would constitute a Nonrecoverable
P&I Advance, shall be evidenced by an Officer's Certificate delivered to the
Trustee, the Paying Agent and the Depositor, in the case of the Servicer or the
Fiscal Agent, and to the Depositor and the Paying Agent, in the case of the
Trustee. The Officer's Certificate shall set forth such determination of
nonrecoverability and the considerations of the Servicer, the Trustee or Fiscal
Agent, as applicable, forming the basis of such determination (which shall
include but shall not be limited to information, to the extent available, such
as related income and expense statements, rent rolls, occupancy status,
property inspections, and shall include an Appraisal of the related Mortgage
Loan or Mortgaged Property, the cost of which Appraisal shall be advanced by
the Servicer as a Servicing Advance). The Trustee shall be entitled to
conclusively rely on the Servicer's determination that a P&I Advance is
nonrecoverable and the Fiscal Agent shall be entitled to conclusively rely on
the Servicer's and/or Trustee's determination that a P&I Advance is
nonrecoverable.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Property
which, in the judgment of the Servicer, the Trustee or the Fiscal Agent, as the
case may be, will not be ultimately recoverable, together with any accrued and
unpaid interest thereon, from Late Collections or any other recovery on or in
respect of such Mortgage Loan or REO Property. The determination by the
Servicer, the Trustee or the Fiscal Agent, as the case may be, that it has made
a Nonrecoverable Servicing Advance or that any proposed Servicing Advance, if
made, would constitute a Nonrecoverable Servicing Advance, shall be evidenced
by an Officer's Certificate delivered to the Trustee, the Paying Agent and the
Depositor, in the case of the Servicer and the Fiscal Agent, and to the
Depositor and the Paying Agent, in the case of the Trustee. The Officer's
Certificate shall set forth such determination of nonrecoverability and the
considerations of the Servicer, the Trustee or the Fiscal Agent, as applicable,
forming the basis of such determination (which shall include but shall not be
limited to information, to the extent available, such as related income and
expense statements, rent rolls, occupancy status and property inspections, and
shall include an Appraisal of the related Mortgage Loan or Mortgaged Property,
the cost of which Appraisal shall be advanced by the Servicer as a Servicing
Advance). The Trustee will be entitled to conclusively rely on the Servicer's
determination that a Servicing Advance is nonrecoverable and the Fiscal Agent
shall be entitled to conclusively rely on the Servicer's and/or the Trustee's
determination that a Servicing Advance is nonrecoverable.
"Non-Registered Certificate": Unless and until registered under the
Securities Act, any Class [F], Class [G], Class [H], Class [R] or Class [LR]
Certificate.
"Non-U.S. Person": Any person other than a U.S. Person, unless, with
respect to the Transfer of a Residual Certificate, (i) such person holds such
Residual Certificate in connection with the conduct of a trade or business
within the United States and furnishes the Transferor and
28
the Certificate Registrar with an effective Internal Revenue Service Form 4224
or (ii) the Transferee delivers to both the Transferor and the Certificate
Registrar an opinion of a nationally recognized tax counsel to the effect that
such Transfer is in accordance with the requirements of the Code and the
regulations promulgated thereunder and that such Transfer of the Residual
Certificate will not be disregarded for federal income tax purposes.
"Notional Amount": The Class [LWAC] Notional Amount, the A-1 Component
Notional Amount or the WAC Component Notional Amount, as the case may be.
"Offered Certificates": The Class [A], Class [B], Class [C], Class
[D], Class [E] and Class [X] Certificates.
"Officer's Certificate": A certificate signed by a Servicing Officer
of the Servicer or the Special Servicer, as the case may be, or a Responsible
Officer of the Trustee or the Fiscal Agent, as the case may be.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor, the Servicer or the Special
Servicer, acceptable in form and delivered to the Trustee, except that any
opinion of counsel relating to (a) the qualification of the Upper-Tier REMIC or
Lower-Tier REMIC as a REMIC, (b) compliance with the REMIC Provisions, or (c)
the resignation of the Servicer, the Special Servicer or the Depositor pursuant
to Section 6.04, must be an opinion of counsel who is in fact Independent of
the Depositor, the Servicer or the Special Servicer, as applicable.
"Original Certificate Balance": With respect to any Class of Regular
Certificates (other than the Class [X] Certificates), the initial aggregate
principal amount thereof as of the Closing Date, in each case as specified in
the Preliminary Statement.
"Original Lower-Tier Principal Amount": With respect to any Class of
Uncertificated Lower-Tier Interest (other than the Class [LWAC] Uncertificated
Interest), the initial principal amount thereof as of the Closing Date, in each
case as specified in the Preliminary Statement.
"Original Notional Amount": With respect to the LWAC Uncertificated
Interest, the A-1 Component or the WAC Component, the respective initial
aggregate Notional Amount thereof as of the Closing Date, in each case as
specified in the Preliminary Statement.
"Original Value": The Appraised Value of a Mortgaged Property based
upon the Appraisal conducted in connection with the origination of the related
Mortgage Loan.
"OTS": The Office of Thrift Supervision or any successor thereto.
"Ownership Interest": As to any Certificate, any ownership or security
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial, as owner or as
pledges.
29
"Pass-Through Rate": Any of the Class [A-1] Pass-Through Rate, the
Class [A-2] Pass-Through Rate, the Class [B] Pass-Through Rate, the Class [C]
Pass-Through Rate, the Class [D] Pass-Through Rate, the Class [E] Pass-Through
Rate, the Class [F] Pass-Through Rate, the Class [G] Pass-Through Rate, the
Class [H] Pass-Through Rate, the [A-1] Component Pass-Through Rate and the WAC
Component Pass-Through Rate.
"Paying Agent": Any agent of the Servicer appointed to act as Paying
Agent pursuant to Section 5.06.
"Penalty Charges": With respect to any Mortgage Loan (or successor REO
Loan), any amounts actually collected thereon from the Mortgagor that represent
late payment charges or Default Interest, other than a Prepayment Premium or
Yield Maintenance Charge.
"Percentage Interest": As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made with respect to the
related Class. With respect to any Regular Certificate, the percentage interest
is equal to the Denomination of such Certificate divided by the initial
Certificate Balance or Notional Amount, as applicable, of such Class of
Certificates as of the Closing Date. With respect to a Residual Certificate,
the percentage interest is set forth on the face thereof.
"Permitted Investments": Any one or more of the following obligations
or securities, regardless whether issued by the Depositor, the Servicer, the
Special Servicer, the Trustee or any of their respective Affiliates and having
the required ratings, if any, provided for in this definition:
(i) direct obligations of, and obligations fully guaranteed
as to timely payment of principal and interest by, the United States
of America, FNMA, FHLMC or any agency or instrumentality of the United
States of America, the obligations of which are backed by the full
faith and credit of the United States of America; provided that any
obligation of, or guarantee by, FNMA or FHLMC, other than an unsecured
senior debt obligation of FNMA or FHLMC, shall be a Permitted
Investment only if such investment would not result in the
downgrading, withdrawal or qualification of the then-current rating
assigned by each Rating Agency to any Certificate as evidenced in
writing;
(ii) demand and time deposits, certificates of deposit, or
bankers' acceptances that mature in 1 year or less after the date of
issuance and are issued or held by any depository institution or trust
company incorporated or organized under the laws of the United States
of America or any State thereof and subject to supervision and
examination by federal or state banking authorities, so long as the
commercial paper or other short-term debt obligations of such
depository institution or trust company are rated at least "A-1+" by
and "D-1+" by __________ or would not result in the downgrading,
withdrawal or qualification of the then-current rating assigned by
each Rating Agency to any Certificate or the long-term debt
obligations of such depository institution or trust company have the
Certificate Rating;
30
(iii) repurchase agreements or obligations with respect to
any security described in clause (i) above where such security has a
remaining maturity of 1 year or less and where such repurchase
obligation has been entered into with a depository institution or
trust company (acting as principal) described in clause (ii) above;
(iv) debt obligations bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the United
States of America or any state thereof, which securities have ratings
from __________ and __________ at least equal to the highest long-term
credit ratings assigned by __________ and __________, unless otherwise
specified in writing by each of the Rating Agencies; provided,
however, that securities issued by any particular corporation will not
be Permitted Investments to the extent that investment therein will
cause the then-outstanding principal amount of securities issued by
such corporation and held in the accounts established hereunder to
exceed 10% of the sum of the aggregate principal balance and the
aggregate principal amount of all Permitted Investments in such
accounts;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations) payable on
demand or on a specified date maturing in 1 year or less after the
date of issuance thereof and which is rated at least "A-1+" by _______
and "D-1+" by _______;
(vi) units of investment funds that maintain a constant net
asset value, including money market funds, rated "AAA--" by __________
and in the highest category by __________);
(vii) certificates or receipts representing ownership
interests in future interest or principal payments on obligations
described in clause (i) above and the Rating Agencies have confirmed
in writing that such investments will not lead to the downgrading,
withdrawal or qualification of any rating then assigned by the Rating
Agencies to any Certificate; and
(viii) any other demand, money market or time deposit,
obligation, security or investment, (a) with respect to which each
Rating Agency shall have confirmed in writing that such investment
will not result in a downgrade, qualification or withdrawal of the
then-current rating of the Certificates that are currently being rated
by such Rating Agency and (b) which qualifies as a "cash flow
investment" pursuant to Section 860G(a)(6) of the Code;
provided, however, that in each case, if the investment is rated by __________,
(a) it shall not have an "r" highlighter affixed to its rating from __________,
(b) it shall have a predetermined fixed dollar of principal due at maturity
that cannot vary or change and (c) any such investment that provides for a
variable rate of interest must have an interest rate that is tied to a single
interest rate index plus a fixed spread, if any, and move proportionately with
such index; and provided, further, however, that no such instrument shall be a
Permitted Investment (a) if such instrument evidences principal and interest
payments derived from obligations underlying such instrument and the interest
payments with respect to such instrument provide a yield to maturity
31
at the time of acquisition of greater than 120% of the yield to maturity at par
of such underlying obligations or (b) if such instrument may be redeemed at a
price below the purchase price; and provided, further, however, that no amount
beneficially owned by either the Upper-Tier REMIC or the Lower-Tier REMIC (even
if not yet deposited in the Trust) may be invested in investments (other than
money market funds) treated as equity interests for federal income tax
purposes, unless the Servicer receives an Opinion of Counsel, at its own
expense, to the effect that such investment will not adversely affect the
status of either the Upper-Tier REMIC or the Lower-Tier REMIC as a REMIC under
the Code or result in imposition of a tax on such Upper-Tier REMIC or
Lower-Tier REMIC. Permitted Investments that are subject to prepayment or call
may not be purchased at a price in excess of par.
"Person": Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"P&I Advance": As to any Mortgage Loan or REO Loan, any advance made
by the Servicer, the Trustee or the Fiscal Agent, as applicable, pursuant to
Section 4.03 or Section 7.05.
"P&I Advance Date": The Business Day immediately prior to each
Distribution Date.
"P&I Advance Determination Date": With respect to any Distribution
Date, the 14th day of the month in which such Distribution Date occurs, or if
such 14th day is not a Business Day, the Business Day immediately succeeding
such date.
"Placement Agents": Bear, ▇▇▇▇▇▇▇ & Co. Inc.
"Plan": As defined in Section 5.02(c).
"Prepayment Assumption": A constant prepayment rate ("CPR") of 0% used
for determining the accrual of original issue discount, market discount and
premium, if any, on the Certificates for federal income tax purposes.
"Prepayment Premium": Any premium, penalty or fee (other than a Yield
Maintenance Charge) paid or payable, as the context requires, by a Mortgagor in
connection with a Principal Prepayment.
"Principal Distribution Amount": With respect to any Distribution
Date, an amount equal to the sum of (a) the Principal Shortfall for such
Distribution Date, (b) the Scheduled Principal Distribution Amount for such
Distribution Date and (c) the Unscheduled Principal Distribution Amount for
such Distribution Date.
"Principal Prepayment": Any payment of principal made by the Mortgagor
on a Mortgage Loan which is received in advance of its scheduled Due Date and
which is not accompanied by an amount of interest representing scheduled
interest due on any date or dates in any month or months subsequent to the
month of prepayment.
32
"Principal Shortfall": For any Distribution Date after the initial
Distribution Date, the amount, if any, by which (a) the related Principal
Distribution Amount for the preceding Distribution Date, exceeded (b) the
aggregate amount distributed in respect of principal on the Class [A], the
Class [B], Class [C], Class [D], Class [E], Class [F], Class [G] and Class [H]
Certificates for such preceding Distribution Date pursuant to Section 4.01(a)
on such preceding Distribution Date. The Principal Shortfall for the initial
Distribution Date will be zero.
"Prospectus": The Prospectus dated _________________, 1998, as
supplemented by the Prospectus Supplement dated ______________, 1998, relating
to the offering of the Offered Certificates.
"Purchase Price": With respect to any Mortgage Loan to be purchased by
a Mortgage Loan Seller pursuant to Section 3 of the related Mortgage Loan
Purchase Agreement, by the Servicer or the Special Servicer pursuant to Section
3.18(b), or by the Servicer, the Special Servicer, the Holders of the
Controlling Class or the Holders of the Class [LR] Certificates pursuant to
Section 9.01 or to be otherwise sold pursuant to Section 3.18(c), a price equal
to:
(i) the outstanding principal balance of such Mortgage Loan
as of the date of purchase; plus
(ii) all accrued and unpaid interest on such Mortgage Loan at
the related Mortgage Rate in effect from time to time to but not
including the Due Date in the Due Period of purchase; plus
(iii) all related unreimbursed Servicing Advances and accrued
and unpaid interest on related Advances at the Reimbursement Rate, and
unpaid Special Servicing Fees allocable to such Mortgage Loan; plus
(iv) if such Mortgage Loan is being purchased by a Mortgage
Loan Seller pursuant to Section 3 of the related Mortgage Loan
Purchase Agreement, all reasonable out-of-pocket expenses reasonably
incurred or to be incurred by the Servicer, the Special Servicer, the
Depositor and the Trustee in respect of the Breach or Defect giving
rise to the repurchase obligation, including any expenses arising out
of the enforcement of the repurchase obligation.
With respect to any REO Property to be sold pursuant to Section
3.18(c), the amount calculated in accordance with the preceding sentence in
respect of the related REO Loan.
"Qualified Institutional Buyer": As defined in Section 5.02(b).
"Qualified Insurer": (i) With respect to any Mortgage Loan, REO Loan
or REO Property, an insurance company or security or bonding company qualified
to write the related Insurance Policy in the relevant jurisdiction with a
minimum claims paying ability rating of at least "A" by __________ and
__________, or, if not rated by __________, at least "A" or its equivalent by
two other nationally recognized statistical rating agencies and (ii) with
respect to the fidelity bond and errors and omissions Insurance Policy required
to be maintained pursuant
33
to Section 3.07(c), an insurance company that has a claims paying ability rated
no lower than two ratings below the rating assigned to the then highest rated
outstanding Certificate, but in no event lower than "A" by __________ and
__________, or, in the case of clauses (i) and (ii), such other rating as each
Rating Agency shall have confirmed in writing will not cause such Rating Agency
to downgrade, qualify or withdraw the then-current rating assigned to any of
the Certificates that are then currently being rated by such Rating Agency.
"Rated Final Distribution Date": As to each Class of Certificates,
___________, 20___, the first Distribution Date after the 24th month following
the end of the amortization term for the Mortgage Loan that, as of the Cut-off
Date, has the longest remaining amortization term.
"Rating Agency": Each of __________ and __________ or their successors
in interest. If neither such rating agency nor any successor remains in
existence, "Rating Agency" shall be deemed to refer to such other nationally
recognized statistical rating agency or other comparable Person designated by
the Depositor, notice of which designation shall be given to the Trustee and
the Servicer, and specific ratings of __________and __________ herein
referenced shall be deemed to refer to the equivalent ratings of the party so
designated.
"Record Date": With respect to any Distribution Date, the last
Business Day of the month immediately preceding the month in which such
Distribution Date occurs.
"Registrar Office": As defined in Section 5.02(a).
"Regular Certificate": Any of the Class [A], Class [B], Class [C],
Class [D], Class [E], Class [F], Class [G], Class [H] and Class [X]
Certificates.
"Reimbursement Rate": The rate per annum applicable to the accrual of
interest on Servicing Advances in accordance with Section 3.03(d) and P&I
Advances in accordance with Section 4.03(d), which rate per annum shall equal
the "Prime Rate" published in the "Money Rates" section of The Wall Street
Journal (or, if such section or publication is no longer available, such other
comparable publication as determined by the Trustee in its reasonable
discretion) as may be in effect from time to time, or, if the "Prime Rate" no
longer exists, such other comparable rate (as determined by the Trustee in its
reasonable discretion) as may be in effect from time to time.
"Related Certificates" and "Related Uncertificated Lower-Tier
Interest": For the following Classes of Uncertificated Lower-Tier Interests,
the related Class of Certificates set forth below and for the following Classes
of Certificates, the related Class of Uncertificated Lower-Tier Interests set
forth below:
Related Uncertificated Related Certificate Lower-Tier Interest
---------------------- ---------------------------------------
Class [A-1] Certificate Class [LA-1] Uncertificated Interest
Class [A-2] Certificate Class [LA-2] Uncertificated Interest
Class [B] Certificate Class [LB] Uncertificated Interest
Class [C] Certificate Class [LC] Uncertificated Interest
34
Class [D] Certificate Class [LD] Uncertificated Interest
Class [E] Certificate Class [LE] Uncertificated Interest
Class [F] Certificate Class [LF] Uncertificated Interest
Class [G] Certificate Class [LG] Uncertificated Interest
Class [H] Certificate Class [LH] Uncertificated Interest
"REMIC": A "real estate mortgage investment conduit" as defined in
Section 860D of the Code (or any successor thereto).
"REMIC Provisions": Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and proposed, temporary and final Treasury regulations and any rulings
promulgated thereunder, as the foregoing may be in effect from time to time.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Account": A segregated custodial account or accounts created and
maintained by the Special Servicer pursuant to Section 3.16 on behalf of the
Trustee in trust for the Certificateholders, which shall be entitled
_______________" , Inc. as Special Servicer, in trust for registered Holders of
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-___, REO Account." Any such account or
accounts shall be an Eligible Account.
"REO Acquisition": The date of acquisition for federal income tax
purposes of any REO Property pursuant to Section 3.09.
"REO Disposition": The sale or other disposition of the REO Property
pursuant to Section 3.18(d).
"REO Extension": As defined in Section 3.16(a).
"REO Loan": The Mortgage Loan deemed for purposes hereof to be
outstanding with respect to each REO Property. Each REO Loan shall be deemed to
be outstanding for so long as the related REO Property remains part of the
Trust Fund as providing for Assumed Scheduled Payments on each Due Date
therefor, and otherwise as having the same terms and conditions as its
predecessor Mortgage Loan, including, without limitation, with respect to the
calculation of the Mortgage Rate in effect from time to time (such terms and
conditions to be applied without regard to the default on such predecessor
Mortgage Loan). Each REO Loan shall be deemed to have an initial outstanding
principal balance and Stated Principal Balance equal to the outstanding
principal balance and Stated Principal Balance, respectively, of its
predecessor Mortgage Loan as of the date of the related REO Acquisition. All
amounts due and owing in respect of the predecessor Mortgage Loan as of the
date of the related REO Acquisition, including, without limitation, accrued and
unpaid interest, shall continue to be due and owing in respect of an REO Loan.
All amounts payable or reimbursable to the Servicer, the Special
35
Servicer, the Fiscal Agent or the Trustee, as applicable, in respect of the
predecessor Mortgage Loan as of the date of the related REO Acquisition,
including, without limitation, any unpaid Special Servicing Fees and Servicing
Fees and any unreimbursed Advances, together with any interest accrued and
payable to the Servicer, the Fiscal Agent or the Trustee in respect of such
Advances in accordance with Section 3.03(d) or Section 4.03(d), shall continue
to be payable or reimbursable to the Servicer, the Trustee or the Fiscal Agent
in respect of an REO Loan. Collections in respect of each REO Loan (exclusive
of amounts to be applied to the payment of, or to be reimbursed to the Servicer
or the Special Servicer for the payment of, the costs of operating, managing
and maintaining the related REO Property) shall be treated: first, as a
recovery of accrued and unpaid interest on such REO Loan at the related
Mortgage Rate in effect from time to time to but not including the Due Date in
the Due Period of receipt; second, as a recovery of principal of such REO Loan
to the extent of its entire unpaid principal balance; and third, in accordance
with the Servicing Standards of the Servicer, as a recovery of any other
amounts due and owing in respect of such REO Loan, including, without
limitation, Yield Maintenance Charges, Prepayment Premiums and Penalty Charges.
"REO Loan Accrual Period": With respect to any REO Loan and any Due
Date therefor, the one-month period immediately preceding such Due Date.
"REO Property": A Mortgaged Property acquired by the Special Servicer
on behalf of, and in the name of, the Trustee for the benefit of the
Certificateholders through foreclosure, acceptance of a deed-in-lieu of
foreclosure or otherwise in accordance with applicable law in connection with
the default or imminent default of a Mortgage Loan.
"REO Revenues": All income, rents and profits derived from the
ownership, operation or leasing of any REO Property.
"Request for Release": A release signed by a Servicing Officer of the
Servicer or the Special Servicer, as applicable, in the form of Exhibit F
attached hereto.
"Residual Certificate": Any Class [R] Certificate or Class [LR]
Certificate issued, authenticated and delivered hereunder.
"Responsible Officer": When used with respect to the initial Trustee
or Fiscal Agent, any Vice President, Assistant Vice President, corporate trust
officer or assistant corporate trust officer in
______________________________________________of __________ or __________, as
the case may be, and with respect to any successor Trustee or Fiscal Agent, any
officer or assistant officer in the corporate trust department of the Trustee
or Fiscal Agent, as the case may be, or any other officer of the Trustee or
Fiscal Agent customarily performing functions similar to those performed by any
of the above designated officers to whom a particular matter is referred by the
Trustee or Fiscal Agent because of such officer's knowledge of and familiarity
with the particular subject.
"Scheduled Principal Distribution Amount": With respect to any
Distribution Date, the aggregate of the principal portions of (a) all Monthly
Payments (excluding Balloon Payments) due in respect of the Mortgage Loans
during or, if and to the extent not previously received or
36
advanced pursuant to Section 4.03 in respect of a preceding Distribution Date,
prior to the related Due Period, and all Assumed Scheduled Payments for the
related Due Period, in each case to the extent either (i) paid by the Mortgagor
as of the Business Day preceding the related P&I Advance Date (and not
previously distributed to Certificateholders) or (ii) advanced by the Servicer,
the Trustee or the Fiscal Agent, as applicable, pursuant to Section 4.03 in
respect of such Distribution Date, and (b) all Balloon Payments to the extent
received during the related Due Period, and to the extent not included in
clause (a) above.
"Securities Act": The Securities Act of 1933, as amended.
"Security Agreement": With respect to any Mortgage Loan, any security
agreement or equivalent instrument, whether contained in the related Mortgage
or executed separately, creating in favor of the holder of such Mortgage a
security interest in the personal property constituting security for repayment
of such Mortgage Loan.
"Servicer": ____________________, ______________________________
(Attention: ______________) and its successor in interest and assigns, or any
successor Servicer appointed as herein provided.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.03.
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses (including attorneys' fees and expenses and fees of
real estate brokers) incurred by the Servicer in connection with the servicing
and administering of (a) a Mortgage Loan in respect of which a default,
delinquency or other unanticipated event has occurred or as to which a default
is reasonably foreseeable or (b) an REO Property, including, but not limited
to, the cost of (i) compliance with the Servicer's obligations set forth in
Section 3.03(c), (ii) the preservation, restoration and protection of a
Mortgaged Property, (iii) obtaining any Insurance and Condemnation Proceeds or
any Liquidation Proceeds of the nature described in clauses (i) - (iv) of the
definition of "Liquidation Proceeds", (iv) any enforcement or judicial
proceedings with respect to a Mortgaged Property, including foreclosures, and
(v) the operation, leasing, management, maintenance and liquidation of any REO
Property.
"Servicing Fee": With respect to each Mortgage Loan and REO Loan, the
fee payable to the Servicer pursuant to the first paragraph of Section 3.11(a).
"Servicing Fee Rate": A rate equal to ___% per annum with respect to
Mortgage Loans sold to the Depositor by ______________, and ___% per annum with
respect to Mortgage Loans sold to the Depositor by ____________, in each case
computed on the basis of the Stated Principal Balance of the related Mortgage
Loan and for the same period for which any related interest payment on the
related Mortgage Loan is computed.
"Servicing Officer": Any officer and/or employee of the Servicer or
the Special Servicer involved in, or responsible for, the administration and
servicing of the Mortgage Loans, whose name and specimen signature appear on a
list of servicing officers furnished by the Servicer to
37
the Trustee and the Depositor on the Closing Date as such list may be amended
from time to time thereafter.
"Servicing Standards": As defined in Section 3.01(a).
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the following events:
(i) a payment default shall have occurred on such Mortgage
Loan at its original maturity date, or if the maturity date of such
Mortgage Loan has been extended, a payment default occurs on such
Mortgage Loan at its extended maturity date; or
(ii) any Monthly Payment (other than a Balloon Payment) is 60
days or more delinquent; or
(iii) the date upon which the Servicer determines that a
payment default has occurred or is imminent and is not likely to be
cured by the related Mortgagor within 60 days; or
(iv) the date upon which a decree or order of a court or
agency or supervisory authority having jurisdiction in the premises in
an involuntary case under any present or future federal or state
bankruptcy, insolvency or similar law or the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshaling of assets and liabilities or similar proceedings,
or for the winding-up or liquidation of its affairs being entered
against the related Mortgagor; provided that if such decree or order
is discharged or stayed within 60 days of being entered, such Mortgage
Loan shall not be a Specially Serviced Mortgage Loan (and no Special
Servicing Fees, Workout Fees or Liquidation Fees will be payable with
respect thereto); or
(v) the related Mortgagor shall consent to the appointment of
a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings of or relating to such Mortgagor or of or relating to all
or substantially all of its property; or
(vi) the related Mortgagor shall admit in writing its
inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations; or
(vii) the Servicer has received notice of the foreclosure or
proposed foreclosure of any lien on the related Mortgaged Property.
"Similar Law": As defined in Section 5.02 (c).
"Special Servicer": _______________, a _______________ corporation, or
any successor special servicer appointed as herein provided.
38
"Special Servicing Fee": With respect to each Specially Serviced
Mortgage Loan and REO Loan, the fee payable to the Special Servicer pursuant to
the first paragraph of Section 3.11(b).
"Special Servicing Fee Rate": With respect to each Specially Serviced
Mortgage Loan and each REO Loan, ___% per annum computed on the basis of the
Stated Principal Balance of the related Mortgage Loan and for the same period
for which any related interest payment on the related Specially Serviced
Mortgage Loan is computed.
"Specially Serviced Mortgage Loan": As defined in Section 3.01(a).
"Startup Day": The day designated as such in Section 10.01(b).
"Stated Principal Balance": With respect to any Mortgage Loan, as of
any date of determination, an amount equal to (x) the Cut-off Date Principal
Balance of such Mortgage Loan, plus (y) any Mortgage Deferred Interest added to
the principal balance of such Mortgage Loan on or before the end of the
immediately preceding Due Period minus (z) the sum of:
(i) the principal portion of each Monthly Payment due on such
Mortgage Loan after the Cut-off Date, to the extent received from the
Mortgagor or advanced by the Servicer and distributed to
Certificateholders on or before such date of determination;
(ii) all Principal Prepayments received with respect to such
Mortgage Loan after the Cut-off Date, to the extent distributed to
Certificateholders on or before such date of determination;
(iii) the principal portion of all Insurance and Condemnation
Proceeds and Liquidation Proceeds received with respect to such
Mortgage Loan after the Cut-off Date, to the extent distributed to
Certificateholders on or before such date of determination; and
(iv) any reduction in the outstanding principal balance of
such Mortgage Loan resulting from a Deficient Valuation that occurred
prior to the end of the Due Period for the most recent Distribution
Date.
With respect to any REO Loan, as of any date of determination, an
amount equal to (x) the Stated Principal Balance of the predecessor Mortgage
Loan as of the date of the related REO Acquisition, minus (y) the sum of:
(i) the principal portion of any P&I Advance made with
respect to the predecessor Mortgage Loan on or after the date of the
related REO Acquisition, to the extent distributed to
Certificateholders on or before such date of determination; and
(ii) the principal portion of all Insurance and Condemnation
Proceeds, Liquidation Proceeds and REO Revenues received with respect
to such REO Loan, to the extent distributed to Certificateholders on
or before such date of determination.
39
A Mortgage Loan or an REO Loan shall be deemed to be part of the Trust
Fund and to have an outstanding Stated Principal Balance until the Distribution
Date on which the payments or other proceeds, if any, received in connection
with a Liquidation Event in respect thereof are to be (or, if no such payments
or other proceeds are received in connection with such Liquidation Event, would
have been) distributed to Certificateholders.
"Subordinate Certificate": Any Class [B], Class [C], Class [D], Class
[E], Class [F], Class [G] or Class [H] Certificate.
"Sub-Servicer": Any Person with which the Servicer or the Special
Servicer has entered into a Sub-Servicing Agreement.
"Sub-Servicing Agreement": The written contract between the Servicer
or the Special Servicer, as the case may be, and any Sub-Servicer relating to
servicing and administration of Mortgage Loans as provided in Section 3.22.
"Tax Returns": The federal income tax return on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of each of the Upper-Tier REMIC and the Lower-Tier REMIC
due to its classification as a REMIC under the REMIC Provisions, together with
any and all other information, reports or returns that may be required to be
furnished to the Certificateholders or filed with the Internal Revenue Service
or any other governmental taxing authority under any applicable provisions of
federal, state or local tax laws.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.
"Transfer Affidavit": As defined in Section 5.02(d).
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
"Transferor Letter": As defined in Section 5.02(d).
"Trust": The trust created hereby and to be administered hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the Trust, consisting of: (i) the Mortgage Loans as from time to
time are subject to this Agreement and all payments under and proceeds of such
Mortgage Loans received after the Cut-off Date (other than payments of
principal and interest due and payable on such Mortgage Loans on or before the
Cut-off Date), together with all documents included in the related Mortgage
Files; (ii) such funds or assets as from time to time are deposited in the
Certificate Account, the Distribution
40
Accounts, any Servicing Accounts, and, if established, the REO Account; (iii)
any REO Property; (iv) the rights of the mortgagee under all Insurance Policies
with respect to the Mortgage Loans and (v) the rights of the Depositor under
Sections 2, 3, 9, 11 and 13 of the Mortgage Loan Purchase Agreements.
"Trustee": _______________, a ________________ corporation, in its
capacity as trustee and its successors in interest, or any successor trustee
appointed as herein provided.
"Trustee Exception Report": As defined in Section 2.02(e).
"Trustee Fee": The fee to be paid to the Trustee as compensation for
the Trustee's activities under this Agreement.
"Trustee Fee Rate": A rate equal to ___% per annum computed on the
basis of the Stated Principal Balance of the related Mortgage Loan.
"UCC": The Uniform Commercial Code, as enacted in each applicable
state.
"UCC Financing Statement": A financing statement executed and filed
pursuant to the UCC, as in effect in the relevant jurisdiction.
"Uncertificated Lower-Tier Interests": Any of the Class [LA-1], Class
[LA-2], Class [LB], Class [LC], Class [LD], Class [LE], Class [LF], Class [LG],
Class [LH] and Class [LWAC] Uncertificated Interests.
"Underwritten Debt Service Coverage Ratio": With respect to any
Mortgage Loan, the ratio of (i) Underwritten Net Cash Flow produced by the
related Mortgaged Property to (ii) the aggregate amount of the Monthly Payments
due for the 12-month period immediately following the Cut-off Date (except with
respect to those Mortgage Loans identified on Schedule 4 where Monthly Payments
initially pay interest only, but, for purposes of this definition only, shall
be assumed to include principal (based upon a 25-year amortization schedule)
and interest payments from origination).
"Underwritten Net Cash Flow": With respect to any Mortgage Loan, the
estimated annual revenue derived from the use and operation of such Mortgaged
Property, less estimated annual expenses, including operating expenses (such as
utilities, administrative expenses, repairs and maintenance, management fees
and advertising), fixed expenses (such as insurance and real estate taxes) and
replacement reserves.
"Underwriter": Bear, ▇▇▇▇▇▇▇ & Co. Inc.
"Uninsured Cause": Any cause of damage to property subject to a
Mortgage such that the complete restoration of such property is not fully
reimbursable by the hazard insurance policies or flood insurance policies
required to be maintained pursuant to Section 3.07.
41
"Unscheduled Principal Distribution Amount": With respect to any
Distribution Date, the aggregate of:
(a) all Principal Prepayments received on the Mortgage Loans during
the related Due Period; and
(b) the principal portions of all Liquidation Proceeds, Insurance and
Condemnation Proceeds and, if applicable, REO Revenues received with respect to
the Mortgage Loans and any REO Loans during the related Due Period, but in each
case only to the extent that such principal portion represents a recovery of
principal for which no advance was previously made pursuant to Section 4.03 in
respect of a preceding Distribution Date.
"Upper-Tier Distribution Account": The segregated account or accounts
created and maintained by the Paying Agent pursuant to Section 3.09(b) in trust
for the Certificateholders, which shall be entitled "__________________, as
Paying Agent, in trust for the registered Holders of Bear ▇▇▇▇▇▇▇ Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
1998- _, Upper-Tier Distribution Account". Any such account or accounts shall
be an Eligible Account.
"Upper-Tier REMIC": One of the two separate REMICs comprising the
Trust Fund, the assets of which consist of the Uncertificated Lower-Tier
Interests and such amounts as shall from time to time be held in the Upper-Tier
Distribution Account.
"U.S. Person": A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate
or trust whose income is subject to United States federal income tax regardless
of its source.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. At all times during the
term of this Agreement, the Voting Rights shall be allocated among the various
Classes of Certificateholders as follows: (i) 4% in the case of the Class [X]
Certificates, and (ii) in the case of any other Class of Regular Certificates a
percentage equal to the product of 96% and a fraction, the numerator of which
is equal to the aggregate Certificate Balance of such Class, in each case,
determined as of the Distribution Date immediately preceding such time, and the
denominator of which is equal to the aggregate Certificate Balance of the
Regular Certificates, each determined as of the Distribution Date immediately
preceding such time. Neither the Class [R] Certificates nor the Class [LR]
Certificates will be entitled to any Voting Rights. For purposes of determining
Voting Rights, the Certificate Balance of any Class shall be deemed to be
reduced by the amount allocated to such Class of any Appraisal Reductions
related to Mortgage Loans as to which Liquidation Proceeds or other final
payment has not yet been received. Voting Rights allocated to a Class of
Certificateholders shall be allocated among such Certificateholders in
proportion to the Percentage Interests evidenced by their respective
Certificates.
42
"WAC Component": One of the two components comprising the Class [X]
Certificates, representing a "specified portion" (within the meaning of
Treasury Regulations Section 1.860G-(l)(a)(2)(i)(C)) of the interest payments
on the Class [LWAC] Uncertificated Interest.
"WAC Component Interest Accrual Amount": With respect to each
Distribution Date, 100% of the interest payable on the Class [LWAC]
Uncertificated Interest, equal to the WAC Component Pass-Through Rate
multiplied by the WAC Component Notional Amount.
"WAC Component Notional Amount": With respect to any Distribution
Date, an amount equal to the Class [LWAC] Notional Amount.
"WAC Component Pass-Through Rate": A rate equal to the excess, if any,
of (i) the Weighted Average Net Mortgage Rate with respect to such Distribution
Date of the Mortgage Loans over (ii) ___%.
"Weighted Average Net Mortgage Rate": The weighted average of the
applicable Net Mortgage Rates of the Mortgage Loans, weighted on the basis of
their respective Stated Principal Balances as of the preceding Distribution
Date (after giving effect to the distribution of principal on such Distribution
Date), or, in the case of the first Distribution Date, the Cut-off Date.
"Workout Fee": The fee paid to the Special Servicer with respect to
each Corrected Mortgage Loan.
"Workout Fee Rate": A fee of ___% of each collection of interest and
principal, including (i) Monthly Payments, (ii) Balloon Payments and (iii)
payments (other than those included in clause (i) or (ii) of this definition)
at maturity, received on each Corrected Mortgage Loan for so long as it remains
a Corrected Mortgage Loan.
"Yield Maintenance Charge": With respect to any Mortgage Loan, the
yield maintenance charge set forth in the related Mortgage Loan Documents.
"Yield Rate": With respect to any Mortgage Loan, the yield rate set
forth in the related Mortgage Loan documents.
SECTION 1.02. Certain Calculations.
Unless otherwise specified herein, for purposes of determining amounts
with respect to the Certificates and the rights and obligations of the parties
hereto, the following provisions shall apply:
(i) All calculations of interest provided for herein shall be
made on the basis of a 360-day year consisting of twelve 30-day
months.
(ii) Any Mortgage Loan payment is deemed to be received on
the date such payment is actually received by the Servicer, the
Special Servicer or the Trustee;
43
provided, however, that for purposes of calculating distributions on
the Certificates, Principal Prepayments with respect to any Mortgage
Loan are deemed to be received on the date they are applied in
accordance with the Servicing Standards consistent with the terms of
the related Mortgage Note and Mortgage to reduce the outstanding
principal balance of such Mortgage Loan on which interest accrues.
(iii) Any reference to the Certificate Balance of any Class
of Certificates on or as of a Distribution Date shall refer to the
Certificate Balance of such Class of Certificates on such Distribution
Date after giving effect to (a) any distributions made on such
Distribution Date pursuant to Section 4.01(a), (b) any Collateral
Support Deficit allocated to such Class on such Distribution Date
pursuant to Section 4.04 and (c) the addition of any Certificate
Deferred Interest allocated to such Class and added to such
Certificate Balance pursuant to Section 4.06(b).
ARTICLE II.
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, does hereby assign to the Trustee, without recourse, for the benefit of
the Certificateholders all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in,
to and under (i) the Mortgage Loans identified on the Mortgage Loan Schedule,
(ii) Sections 2, 3, 9, 11 and 13 of the Mortgage Loan Purchase Agreements and
(iii) all other assets included or to be included in the Trust Fund. Such
assignment includes all interest and principal received or receivable on or
with respect to the Mortgage Loans (other than payments of principal and
interest due and payable on the Mortgage Loans on or before the Cut-off Date).
The transfer of the Mortgage Loans and the related rights and property
accomplished hereby is absolute and, notwithstanding Section 11.07, is intended
by the parties to constitute a sale.
(b) In connection with the Depositor's assignment pursuant to
subsection (a) above, the Depositor shall direct, and hereby represents and
warrants that it has directed, the Mortgage Loan Sellers pursuant to each
Mortgage Loan Purchase Agreement to deliver to and deposit with, or cause to be
delivered to and deposited with, the Trustee or a Custodian appointed thereby,
on or before the Closing Date, the Mortgage File for each Mortgage Loan so
assigned. If a Mortgage Loan Seller cannot deliver, or cause to be delivered as
to any Mortgage Loan, the original Mortgage Note, such Mortgage Loan Seller
shall deliver a copy or duplicate original of such Mortgage Note, together with
an affidavit certifying that the original thereof has been lost or destroyed.
If a Mortgage Loan Seller cannot deliver, or cause to be delivered, as to any
Mortgage Loan, any of the documents and/or instruments referred to in clauses
(ii), (iv), (vii), (viii), (xi) and (xii) of the definition of "Mortgage File,"
with evidence of recording thereon, solely because of a delay caused by the
public recording office where such document or instrument has been delivered
for recordation, the delivery requirements of the related Mortgage
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Loan Purchase Agreement and this Section 2.01(b) shall be deemed to have been
satisfied as to such non-delivered document or instrument, and such
non-delivered document or instrument shall be deemed to have been included in
the Mortgage File, provided that a photocopy of such non-delivered document or
instrument (certified by such Mortgage Loan Seller to be a true and complete
copy of the original thereof submitted for recording) is delivered to the
Trustee or a Custodian appointed thereby on or before the Closing Date, and
either the original of such non-delivered document or instrument, or a
photocopy thereof (certified by the appropriate county recorder's office to be
a true and complete copy of the original thereof submitted for recording), with
evidence of recording thereon, is delivered to the Trustee or such Custodian
within 120 days of the Closing Date (or within such longer period after the
Closing Date as the Trustee may consent to, which consent shall not be
unreasonably withheld so long as such Mortgage Loan Seller is, as certified in
writing to the Trustee no less often than monthly, in good faith attempting to
obtain from the appropriate county recorder's office such original or
photocopy). If a Mortgage Loan Seller cannot deliver, or cause to be delivered,
as to any Mortgage Loan, any of the documents and/or instruments referred to in
clauses (ii), (iv), (vii), (viii), (xi) and (xii) of the definition of
"Mortgage File," with evidence of recording thereon, for any other reason,
including, without limitation, that such non-delivered document or instrument
has been lost, the delivery requirements of the related Mortgage Loan Purchase
Agreement and this Section 2.01(b) shall be deemed to have been satisfied as to
such non-delivered document or instrument, and such non-delivered document or
instrument shall be deemed to have been included in the Mortgage File, provided
that a photocopy of such non-delivered document or instrument (with evidence of
recording thereon and certified by the appropriate county recorder's office to
be a true and complete copy of the original thereof submitted for recording) is
delivered to the Trustee or a Custodian appointed thereby on or before the
Closing Date. Neither the Trustee nor any Custodian shall in any way be liable
for any failure by any Mortgage Loan Seller or the Depositor to comply with the
delivery requirements of the Mortgage Loan Purchase Agreements and this Section
2.01(b). Notwithstanding the foregoing, in the event that a Mortgage Loan
Seller fails to deliver a UCC-3 on or before the Closing Date as required above
solely because the related UCC-1 has not been returned to such Mortgage Loan
Seller by the applicable filing office, the Mortgage Loan Seller shall not be
in breach of its obligations with respect to such delivery, provided that such
Mortgage Loan Seller promptly forwards such UCC-1 to the Trustee upon its
return. The Trustee shall cause such UCC-3 to be filed within 60 days of its
receipt of the related UCC-1.
(c) Except under the circumstances provided for in the last sentence
of this subsection (c), the Trustee shall, as to each Mortgage Loan, promptly
(and in any event within 90 days of the Closing Date) cause to be submitted for
recording or filing, as the case may be, in the appropriate public office for
real property records or UCC Financing Statements, as appropriate, each
assignment to the Trustee referred to in clauses (ii), (iii), (iv), (v), (vii)
and (xii) of the definition of "Mortgage File" and each UCC-1, UCC-2 and UCC-3
to the Trustee referred to in clause (xi) of the definition of "Mortgage File."
Each such assignment shall reflect that it should be returned by the public
recording office to the Trustee following recording, and each such UCC-1, UCC-2
and UCC-3 shall reflect that the file copy thereof should be returned to the
Trustee following filing. If any such document or instrument is lost or
returned unrecorded or unfiled, as the case may be, because of a defect
therein, the Trustee shall prepare or cause to be prepared a substitute
therefor or cure such defect, as the case may be, and thereafter the
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Trustee shall upon receipt thereof cause the same to be duly recorded or filed,
as appropriate. Notwithstanding the foregoing, there shall be no requirement to
record any assignment to the Trustee referred to in clause (iii) or (v) of the
definition of "Mortgage File," or to file any UCC-1, UCC-2 or UCC-3 to the
Trustee referred to in clause (xi) of the definition of "Mortgage File," in
those jurisdictions where, in the written opinion of local counsel (which
opinion shall not be an expense of the Trust Fund) acceptable to the Depositor
and the Trustee, such recordation and/or filing is not required to protect the
Trustee's interest in the related Mortgage Loans against sale, further
assignment, satisfaction or discharge by the related Mortgage Loan Seller, the
Servicer, the Special Servicer, any Sub-Servicer or the Depositor.
(d) All documents and records in the Depositor's or any Mortgage Loan
Seller's possession relating to the Mortgage Loans (including financial
statements, operating statements and any other information provided by the
respective Mortgagor from time to time) that are not required to be a part of a
Mortgage File in accordance with the definition thereof shall be delivered to
the Servicer on or before the Closing Date and shall be held by the Servicer on
behalf of the Trustee in trust for the benefit of the Certificateholders.
(e) In connection with the Depositor's assignment pursuant to
subsection (a) above, the Depositor shall deliver, and hereby represents and
warrants that it has delivered, to the Trustee and the Servicer, on or before
the Closing Date, a fully executed original counterpart of each Mortgage Loan
Purchase Agreement, as in full force and effect, without amendment or
modification, on the Closing Date.
(f) The Depositor shall use its best efforts to require that, promptly
after the Closing Date, but in all events within three Business Days after the
Closing Date, each Mortgage Loan Seller shall cause all funds on deposit in
escrow accounts maintained with respect to the Mortgage Loans in the name of
such Mortgage Loan Seller or any other name to be transferred to the Servicer
(or a Sub-Servicer) for deposit into Servicing Accounts.
SECTION 2.02. Acceptance by Trustee.
(a) The Trustee, by the execution and delivery of this Agreement,
acknowledges receipt by it or a Custodian on its behalf, subject to the
provisions of Section 2.01 and to any exceptions noted on the Trustee Exception
Report, of the documents specified in clauses (i) (v), (viii), (ix) and (xiii)
of the definition of "Mortgage File" with respect to each Mortgage Loan, of a
fully executed original counterpart of each Mortgage Loan Purchase Agreement
and of all other assets included in the Trust Fund, in good faith and without
notice of any adverse claim, and declares that it or a Custodian on its behalf
holds and will hold such documents and the other documents delivered or caused
to be delivered by the Mortgage Loan Seller constituting the Mortgage Files,
and that it holds and will hold such other assets included in the Trust Fund,
in trust for the exclusive use and benefit of all present and future
Certificateholders.
(b) Within 60 days of the Closing Date, the Trustee or a Custodian on
its behalf shall review each of the Mortgage Loan documents delivered or caused
to be delivered by the Mortgage Loan Seller constituting the Mortgage Files;
and, promptly following such review (but in no event later than 90 days after
the Closing Date), the Trustee shall certify in writing to each
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of the Depositor, the Servicer, the Special Servicer and each Mortgage Loan
Seller that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in any exception report annexed thereto as not being covered by such
certification), (i) all documents specified in clauses (i) - (v), (viii), (ix),
(xi), (xii) and (xiii) of the definition of "Mortgage File" are in its
possession, (ii) all documents delivered or caused to be delivered by the
Mortgage Loan Sellers constituting the Mortgage Files have been reviewed by it
or by a Custodian on its behalf and appear regular on their face and relate to
such Mortgage Loan, and (iii) based on such examination and only as to the
foregoing documents, the information set forth in the Mortgage Loan Schedule
with respect to the items specified in clauses (i), (iv), (vi), (viii)(a) and
(viii)(c) of the definition of "Mortgage Loan Schedule" is correct.
(c) The Trustee or a Custodian on its behalf shall review each of the
Mortgage Loan documents received thereby subsequent to the Closing Date; and,
on or about the first anniversary of the Closing Date, the Trustee shall
certify in writing to each of the Depositor, the Servicer, the Special Servicer
and each Mortgage Loan Seller that, as to each Mortgage Loan listed on the
Mortgage Loan Schedule (other than any Mortgage Loan as to which a Liquidation
Event has occurred or any Mortgage Loan specifically identified in any
exception report annexed thereto as not being covered by such certification),
(i) all documents specified in clauses (i) - (v), (viii), (ix), (xi), (xii) and
(xiii) of the definition of "Mortgage File" are in its possession, (ii) it or a
Custodian on its behalf has received either a recorded original of each of the
assignments specified in clause (iii) and, insofar as an unrecorded original
thereof had been delivered or caused to be delivered by the related Mortgage
Loan Seller, pursuant to clause (v) of the definition of "Mortgage File" or a
copy of such recorded original certified by the applicable public recording
office to be true and complete, (iii) all Mortgage Loan documents received by
it or any Custodian have been reviewed by it or by such Custodian on its behalf
and appear regular on their face and relate to such Mortgage Loan and (iv)
based on the examinations referred to in subsection (b) above and this
subsection (c) and only as to the foregoing documents, the information set
forth in the Mortgage Loan Schedule with respect to the items specified in
clauses (i), (iv), (vi), (viii) (a) and (viii) (c) of the definition of
"Mortgage Loan Schedule" is correct.
(d) It is herein acknowledged that neither the Trustee nor any
Custodian is under any duty or obligation (i) to determine whether any of the
documents specified in clauses (iv) - (viii), (x) and (xiv) of the definition
of "Mortgage File" exist or are required to be delivered by the Depositor, the
Mortgage Loan Sellers or any other Person or (ii) to inspect, review or examine
any of the documents, instruments, certificates or other papers relating to the
Mortgage Loans delivered to it to determine that the same are genuine,
enforceable or appropriate for the represented purpose or that they are other
than what they purport to be on their face.
(e) If, in the process of reviewing the Mortgage Files or at any time
thereafter, the Trustee or any Custodian finds any document or documents
constituting a part of a Mortgage File not to have been properly executed or,
subject to Section 2.01(b), not to have been delivered, to contain information
that does not conform in any material respect with the corresponding
information set forth in the Mortgage Loan Schedule or to be defective on its
face (each, a "Defect" in the related Mortgage File), the Trustee shall
promptly so notify the
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Depositor, the Servicer, the Special Servicer and the applicable Mortgage Loan
Seller (and in no event later than 90 days after the Closing Date), by
providing a written report (the "Trustee Exception Report") setting forth for
each affected Mortgage Loan, with particularity, the nature of such Defect.
SECTION 2.03. Representations, Warranties and Covenants of the Depositor;
Mortgage Loan Seller's Repurchase of Mortgage Loans for
Defects in Mortgage Files and Breaches of Representations
and Warranties.
(a) The Depositor hereby represents and warrants that:
(i) The Depositor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware,
and the Depositor has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement by
it, and has the power and authority to execute, deliver and perform
this Agreement and all the transactions contemplated hereby,
including, but not limited to, the power and authority to sell, assign
and transfer the Mortgage Loans in accordance with this Agreement;
(ii) Assuming the due authorization, execution and delivery
of this Agreement by each other party hereto, this Agreement and all
of the obligations of the Depositor hereunder are the legal, valid and
binding obligations of the Depositor, enforceable against the
Depositor in accordance with the terms of this Agreement, except as
such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law);
(iii) The execution and delivery of this Agreement and the
performance of its obligations hereunder by the Depositor will not
conflict with any provisions of any law or regulations to which the
Depositor is subject, or conflict with, result in a breach of or
constitute a default under any of the terms, conditions or provisions
of the certificate of incorporation or the by-laws of the Depositor or
any indenture, agreement or instrument to which the Depositor is a
party or by which it is bound, or any order or decree applicable to
the Depositor, or result in the creation or imposition of any lien on
any of the Depositor's assets or property, which would materially and
adversely affect the ability of the Depositor to carry out the
transactions contemplated by this Agreement; the Depositor has
obtained any consent, approval, authorization or order of any court or
governmental agency or body required for the execution, delivery and
performance by the Depositor of this Agreement;
(iv) There is no action, suit or proceeding pending or, to
the Depositor's knowledge, threatened against the Depositor in any
court or by or before any other governmental agency or instrumentality
which would materially and adversely affect the
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validity of the Mortgage Loans or the ability of the Depositor to
carry out the transactions contemplated by this Agreement; and
(v) The Depositor is the lawful owner of the Mortgage Loans
with the full right to transfer the Mortgage Loans to the Trust and
the Mortgage Loans have been validly transferred to the Trust.
(b) If any Certificateholder, the Servicer, the Special Servicer or
the Trustee discovers or receives notice of a Defect in any Mortgage File or a
breach of any representation or warranty set forth in, or required to be made
with respect to a Mortgage Loan by a Mortgage Loan Seller pursuant to, the
related Mortgage Loan Purchase Agreement (a "Breach"), which Defect or Breach,
as the case may be, materially and adversely affects the value of any Mortgage
Loan or the interests of the Certificateholders therein, such
Certificateholder, the Servicer, the Special Servicer or the Trustee, as
applicable, shall give prompt written notice of such Defect or Breach, as the
case may be, to the Depositor, the Servicer, the Special Servicer and the
related Mortgage Loan Seller and shall request that such Mortgage Loan Seller,
not later than the earlier of 90 days from such Mortgage Loan Seller's receipt
of such notice or such Mortgage Loan Seller's discovery of such Breach, cure
such Defect or Breach, as the case may be, in all material respects or
repurchase the affected Mortgage Loan at the applicable Purchase Price or in
conformity with the related Mortgage Loan Purchase Agreement. Any Defect or
Breach which causes any Mortgage Loan not to be a "qualified mortgage" (within
the meaning of Section 860G(a)(3) of the Code) shall be deemed to materially
and adversely affect the interest of Certificateholders therein. If the
affected Mortgage Loan is to be repurchased, the Trustee shall designate the
Certificate Account as the account into which funds in the amount of the
Purchase Price are to be deposited by wire transfer.
(c) In connection with any repurchase of a Mortgage Loan contemplated
by this Section 2.03, the Trustee, the Servicer and the Special Servicer shall
each tender to the applicable Mortgage Loan Seller, upon delivery to each of
the Trustee, the Servicer and the Special Servicer of a trust receipt executed
by such Mortgage Loan Seller, all portions of the Mortgage File and other
documents pertaining to such Mortgage Loan possessed by it, and each document
that constitutes a part of the Mortgage File that was endorsed or assigned to
the Trustee shall be endorsed or assigned, as the case may be, to such Mortgage
Loan Seller in the same manner as provided in Section 3 of the related Mortgage
Loan Purchase Agreement.
(d) Section 3 of each Mortgage Loan Purchase Agreement provides the
sole remedy available to the Certificateholders, or the Trustee on behalf of
the Certificateholders, respecting any Defect in a Mortgage File or any Breach
of any representation or warranty set forth in or required to be made pursuant
to Section 2 of such Mortgage Loan Purchase Agreement.
(e) The Trustee and the Special Servicer (in the case of Specially
Serviced Mortgage Loans) shall, for the benefit of the Certificateholders,
enforce the obligations of each Mortgage Loan Seller under Section 3 of the
Mortgage Loan Purchase Agreements. Such enforcement, including, without
limitation, the legal prosecution of claims, shall be carried out in such form,
to such extent and at such time as the Trustee or the Special Servicer, as the
case may be, would require were it, in its individual capacity, the owner of
the affected Mortgage Loan(s). The
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Trustee and the Special Servicer, as the case maybe, shall be reimbursed for
the reasonable costs of such enforcement: first, from a specific recovery of
costs, expenses or attorneys' fees against the applicable Mortgage Loan Seller;
second, pursuant to Section 3.05(a)(vii) out of the related Purchase Price, to
the extent that such expenses are a specific component thereof; and third, if
at the conclusion of such enforcement action it is determined that the amounts
described in clauses first and second are insufficient, then pursuant to
Section 3.05(a)(viii) out of general collections on the Mortgage Loans on
deposit in the Certificate Account.
SECTION 2.04. Execution of Certificates.
The Trustee hereby acknowledges the assignment to it of the Mortgage
Loans and, subject to Sections 2.01 and 2.02, the delivery to it or a Custodian
on its behalf of the Mortgage Files and a fully executed original counterpart
of each Mortgage Loan Purchase Agreement, together with the assignment to it of
all other assets included in the Trust Fund. Concurrently with such assignment
and delivery and in exchange therefor, the Trustee acknowledges the issuance of
the Uncertificated Lower-Tier Interests to the Depositor and the authentication
and delivery of the Class [LR] Certificates to or upon the order of the
Depositor, in exchange for the Mortgage Loans, receipt of which is hereby
acknowledged, and immediately thereafter, the Trustee acknowledges that it has
executed and caused the Authenticating Agent to authenticate and to deliver to
or upon the order of the Depositor, in exchange for the Uncertificated
Lower-Tier Interests, the Regular Certificates and the Class [R] Certificates,
and the Depositor hereby acknowledges the receipt by it or its designees, of
such Certificates in authorized Denominations evidencing the entire beneficial
ownership of the Upper-Tier REMIC.
ARTICLE III.
ADMINISTRATION AND
SERVICING OF THE TRUST FUND
SECTION 3.01. Servicer to Act as Servicer; Special Servicer to Act as Special
Servicer; Administration of the Mortgage Loans.
(a) Each of the Servicer and the Special Servicer shall diligently
service and administer the Mortgage Loans it is obligated to service pursuant
to this Agreement on behalf of the Trustee and in the best interests of and for
the benefit of the Certificateholders (as determined by the Servicer or the
Special Servicer, as the case may be, in its good faith and reasonable
judgment) in accordance with applicable law, the terms of this Agreement and
the terms of the respective Mortgage Loans and, to the extent consistent with
the foregoing, and in accordance with the higher of the following standards of
care: (1) the same manner in which, and with the same care, skill, prudence and
diligence with which the Servicer or Special Servicer, as the case may be,
services and administers similar mortgage loans for other third-party
portfolios, giving due consideration to the customary and usual standards of
practice of prudent institutional multifamily and mobile home community
mortgage lenders servicing their own mortgage loans and (2) the same care,
skill, prudence and diligence with which the Servicer or Special Servicer, as
the case may be, services and administers mortgage loans owned by the
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Servicer or Special Servicer, as the case may be, if applicable, in either case
exercising reasonable business judgment and acting in accordance with
applicable law, the terms of this Agreement, the respective Mortgage Loans or
Specially Serviced Mortgage Loans, as applicable, and with a view to the
maximization of timely recovery of principal and interest on a present value
basis on the Mortgage Loans or Specially Serviced Mortgage Loans, as
applicable, and the best interests of the Trust and the Certificateholders, as
determined by the Servicer or Special Servicer, as the case may be, in its
reasonable judgment, but without regard to: (i) any relationship that the
Servicer or the Special Servicer, as the case may be, or any Affiliate thereof
may have with the related Mortgagor or any other party to this Agreement; (ii)
the ownership of any Certificate by the Servicer or the Special Servicer, as
the case may be, or any Affiliate thereof; (iii) the Servicer's obligation to
make Advances; (iv) the Servicer's or Special Servicer's, as the case may be,
right to receive compensation for its services hereunder or with respect to any
particular transaction and (v) any obligation of the Servicer (in its capacity
as a Mortgage Loan Seller) to cure a breach of a representation or warranty or
repurchase a Mortgage Loan (the foregoing, collectively referred to as the
"Servicing Standards"). Without limiting the foregoing, subject to Section
3.21, the Special Servicer shall be obligated to service and administer (i) any
Mortgage Loans as to which a Servicing Transfer Event has occurred and is
continuing (the "Specially Serviced Mortgage Loans") and (ii) any REO
Properties; provided, that the Servicer shall continue to make all
calculations, and prepare, or cause to be prepared, all reports to the
Certificateholders, required hereunder with respect to the Specially Serviced
Mortgage Loans as if no Servicing Transfer Event had occurred and with respect
to the REO Properties (and the related REO Loans) as if no REO Acquisition had
occurred, and to render such incidental services with respect to such Specially
Serviced Mortgage Loans and REO Properties as are specifically provided for
herein; provided, further, however, that the Servicer shall not be liable for
failure to comply with such duties insofar as such failure results from a
failure of the Special Servicer to provide sufficient information to the
Servicer to comply with such duties. Each Mortgage Loan that becomes a
Specially Serviced Mortgage Loan shall continue as such until satisfaction of
the conditions specified in Section 3.21(a). Without limiting the foregoing,
subject to Section 3.21, the Servicer shall be obligated to service and
administer all Mortgage Loans which are not Specially Serviced Mortgage Loans;
provided, that the Special Servicer shall make the inspections, use its
reasonable best efforts to collect the statements and shall prepare the reports
in respect of the related Mortgaged Properties with respect to Specially
Serviced Mortgage Loans in accordance with Section 3.12.
(b) Subject only to the Servicing Standards and the terms of this
Agreement and of the respective Mortgage Loans, the Servicer and the Special
Servicer each shall have full power and authority, acting alone, to do or cause
to be done any and all things in connection with such servicing and
administration which it may deem necessary or desirable. Without limiting the
generality of the foregoing, each of the Servicer and the Special Servicer, in
its own name, is hereby authorized and empowered by the Trustee and obligated
to execute and deliver, on behalf of the Certificateholders and the Trustee or
any of them, with respect to each Mortgage Loan it is obligated to service
under this Agreement, any and all financing statements, continuation statements
and other documents or instruments necessary to maintain the lien created by
the related Mortgage or other security document in the related Mortgage File on
the related Mortgaged Property and related collateral; subject to Section 3.20,
any and all modifications, waivers, amendments or consents to or with respect
to any documents contained in the related
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Mortgage File; and any and all instruments of satisfaction or cancellation, or
of partial or full release or discharge, and all other comparable instruments.
Subject to Section 3.10, the Trustee shall furnish, or cause to be furnished,
to the Servicer or the Special Servicer any powers of attorney and other
documents necessary or appropriate to enable the Servicer or the Special
Servicer, as the case may be, to carry out its servicing and administrative
duties hereunder; provided, however, that the Trustee shall not be held liable
for any negligence with respect to, or misuse of, any such power of attorney by
the Servicer or the Special Servicer.
(c) The relationship of the Servicer to the Trustee under this
Agreement is intended by the parties to be that of an independent contractor
and not that of a joint venturer, partner or agent.
SECTION 3.02. Collection of Mortgage Loan Payments.
(a) Each of the Servicer and the Special Servicer shall make
reasonable efforts to collect all payments called for under the terms and
provisions of the Mortgage Loans it is obligated to service hereunder, and
shall follow such collection procedures as are consistent with this Agreement
(including, without limitation, the Servicing Standards). Consistent with the
foregoing, the Servicer or the Special Servicer each may in its discretion
waive any Penalty Charge in connection with any delinquent payment on a
Mortgage Loan it is obligated to service hereunder.
(b) All amounts collected on any Mortgage Loan in the form of Garments
from Mortgagors, Insurance and Condemnation Proceeds or Liquidation Proceeds
shall be applied to amounts due and owing under the related Mortgage Note and
Mortgage (including, without limitation, for principal and accrued and unpaid
interest) in accordance with the express provisions of the related Mortgage
Note and Mortgage and, in the absence of such express provisions, shall be
applied (after reimbursement to the Servicer, the Trustee and/or the Fiscal
Agent for any related Servicing Advances and interest thereon as provided
herein): first, as a recovery of accrued and unpaid interest on such Mortgage
Loan at the related Mortgage Rate in effect from time to time to but not
including the Due Date in the Due Period of receipt; second, as a recovery of
principal of such Mortgage Loan to the extent of its entire unpaid principal
balance and third, in accordance with the Servicing Standards, as a recovery of
any other amounts due and owing on such Mortgage Loan, including, without
limitation, Prepayment Premiums, Yield Maintenance Charges and Penalty Charges.
Amounts collected on any REO Loan shall be deemed to be applied in accordance
with the definition thereof.
(c) To the extent consistent with the terms of the Mortgage Loans and
applicable law, the Servicer shall apply all Insurance and Condemnation
Proceeds it receives on a day other than the first day of a month to amounts
due and owing under the related Mortgage Loan as if such Insurance and
Condemnation Proceeds were received on the first day of the calendar month
immediately succeeding the month in which such Insurance and Condemnation
Proceeds were received.
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SECTION 3.03. Collection of Taxes, Assessments and Similar Items; Servicing
Accounts.
(a) The Servicer shall establish and maintain one or more accounts
(the "Servicing Accounts"), into which all Escrow Payments shall be deposited
and retained, and shall administer such Servicing Accounts in accordance with
the Mortgage Loan documents. Servicing Accounts shall be Eligible Accounts.
Withdrawals of amounts so deposited from a Servicing Account may be made only
to: (i) effect payment of real estate taxes, assessments, insurance premiums,
ground rents (if applicable) and comparable items; (ii) reimburse the Servicer,
the Trustee or the Fiscal Agent for any Servicing Advances; (iii) refund to
Mortgagors any sums as may be determined to be overages; (iv) pay interest to
Mortgagors on balances in the Servicing Account, if required by applicable law
or the terms of the related Mortgage Loan and as described below or, if not so
required, to the Servicer; (v) withdraw amounts deposited in error or (vi)
clear and terminate the Servicing Account at the termination of this Agreement
in accordance with Section 9.01. As part of its servicing duties, the Servicer
shall pay or cause to be paid to the Mortgagors interest on funds in Servicing
Accounts, to the extent required by law or the terms of the related Mortgage
Loan.
(b) The Special Servicer, in the case of REO Loans, and the Servicer,
in the case of all other Mortgage Loans, shall maintain accurate records with
respect to each related Mortgaged Property reflecting the status of real estate
taxes, assessments and other similar items that are or may become a lien
thereon and the status of insurance premiums and any ground rents payable in
respect thereof. The Special Servicer, in the case of REO Loans, and the
Servicer, in the case of all other Mortgage Loans, shall obtain, from time to
time, all bills for the payment of such items (including renewal premiums) and
shall effect payment thereof from the REO Account or by the Servicer as
Servicing Advances prior to the applicable penalty or termination date,
employing for such purpose Escrow Payments (which shall be so applied by the
Servicer at the written direction of the Special Servicer in the case of REO
Loans) as allowed under the terms of the related Mortgage Loan. The Servicer
or, with respect to any Mortgage Loan that is a Specially Serviced Mortgage
Loan, the Special Servicer shall service and administer any reserve accounts
(including monitoring, maintaining or changing the amounts of required escrows)
in accordance with the terms of such Mortgage Loan and the Servicing Standards.
To the extent that a Mortgage Loan does not require a Mortgagor to escrow for
the payment of real estate taxes, assessments, insurance premiums, ground rents
(if applicable) and similar items, the Special Servicer, in the case of REO
Loans, and the Servicer, in the case of all other Mortgage Loans, shall require
that payments in respect of such items be made by the Mortgagor at the time
they first become due.
(c) In accordance with the Servicing Standards and for all Mortgage
Loans, the Servicer shall advance with respect to each related Mortgaged
Property (including any REO Property) all such funds as are necessary for the
purpose of effecting the payment of (i) real estate taxes, assessments and
other similar items that are or may become a lien thereon, (ii) ground rents
(if applicable) and (iii) premiums on Insurance Policies, in each instance if
and to the extent Escrow Payments collected from the related Mortgagor are
insufficient to pay such item when due and the related Mortgagor has failed to
pay such item on a timely basis, and provided, however, that the particular
advance would not, if made, constitute a Nonrecoverable Servicing Advance and
provided, further, however, that with respect to the payment of taxes and
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assessments, the Servicer shall not be required to make such advance until the
earlier of five Business Days after the Servicer has received confirmation that
such item has not been paid or the date prior to the date after which any
penalty or interest would accrue in respect of such taxes or assessments. The
Special Servicer shall give the Servicer, the Trustee and the Fiscal Agent not
less than five Business Days' notice before the date on which the Servicer is
requested to make any Servicing Advance with respect to a given Mortgage Loan
or REO Property; provided, however, that only two Business Days' notice shall
be required in respect of Servicing Advances required to be made on an urgent
or emergency basis (which may include, without limitation, Servicing Advances
required to make tax or insurance payments). In addition, the Special Servicer
shall provide the Servicer, the Trustee and the Fiscal Agent with such
information in its possession as the Servicer, the Trustee or the Fiscal Agent,
as applicable, may reasonably request to enable the Servicer, the Trustee or
the Fiscal Agent, as applicable, to determine whether a requested Servicing
Advance would constitute a Nonrecoverable Advance. All such advances shall be
reimbursable in the first instance from related collections from the Mortgagors
and further as provided in Section 3.05. No costs incurred by the Servicer or
the Special Servicer in effecting the payment of real estate taxes, assessments
and, if applicable, ground rents on or in respect of the Mortgaged Properties
shall, for purposes hereof, including, without limitation, calculating monthly
distributions to Certificateholders, be added to the unpaid principal balances
of the related Mortgage Loans, notwithstanding that the terms of such Mortgage
Loans so permit. The failure by the Servicer to make any required Servicing
Advance as and when due shall constitute an Event of Default under Section
7.01(a)(i) and, to the extent the Trustee has knowledge that such Servicing
Advance is necessary, the Trustee shall make such Servicing Advance pursuant to
Section 7.05. If the Trustee fails to make such Servicing Advance, to the
extent the Fiscal Agent has knowledge that such Servicing Advance is necessary,
the Fiscal Agent shall make such Servicing Advance pursuant to Section 7.05.
(d) In connection with its recovery of any Servicing Advance out of
the Certificate Account pursuant to Section 3.05(a), each of the Servicer, the
Trustee and the Fiscal Agent, as the case may be, shall be entitled to receive,
out of any amounts then on deposit in the Certificate Account, interest at the
Reimbursement Rate in effect from time to time, accrued on the amount of such
Servicing Advance from the date made to, but not including, the date of
reimbursement. The Servicer shall reimburse itself, the Trustee or the Fiscal
Agent, as the case may be, for any outstanding Servicing Advance as soon as
practically possible after funds available for such purpose are deposited in
the Certificate Account.
(e) To the extent an operations and maintenance plan is required to be
established and executed pursuant to the terms of a Mortgage Loan, the Servicer
shall request from the Mortgagor written confirmation thereof within a
reasonable time after the later of the Closing Date and the date as of which
such plan is required to be established or completed. To the extent any
repairs, capital improvements, actions or remediations are required to have
been taken or completed pursuant to the terms of the Mortgage Loan, the
Servicer shall request from the Mortgagor written confirmation of such actions
and remediations within a reasonable time after the later of the Closing Date
and the date as of which such action or remediations are required to be or to
have been taken or completed. To the extent a Mortgagor shall fail to promptly
respond to any inquiry described in this Section 3.03(e), the Servicer shall
determine whether the related Mortgagor has failed to perform its obligations
under the related Mortgage Loan and
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report any such failure to the Special Servicer within a reasonable time after
the later of _____________, 1998 and the date as of which such actions or
remediations are required to be or to have been taken or completed.
SECTION 3.04. The Certificate Account and the Lower-Tier and Upper-Tier
Distribution Accounts.
(a) The Servicer shall establish and maintain, or cause to be
established and maintained, a Certificate Account in which the Servicer shall
deposit or cause to be deposited on a daily basis (and in no event later than
the Business Day following receipt of available funds), except as otherwise
specifically provided herein, the following payments and collections received
or made by or on behalf of it subsequent to the Cut-off Date (other than in
respect of principal and interest on the Mortgage Loans due and payable on or
before the Cut-off Date), or payments (other than Principal Prepayments)
received by it on or prior to the Cut-off Date but allocable to a period
subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (including, without
limitation, Default Interest) on the Mortgage Loans (net of the
Servicing Fees), late payment charges, Prepayment Premiums and Yield
Maintenance Charges;
(iii) all Insurance and Condemnation Proceeds and Liquidation
Proceeds received in respect of any Mortgage Loan or REO Property
(other than Liquidation Proceeds that are received in connection with
the Servicer, the Special Servicer, the Holders of the Controlling
Class, or the purchase by Holders of the Class [LR] Certificates of
all the Mortgage Loans and any REO Properties in the Trust Fund and
that are to be deposited in the Lower-Tier Distribution Account
pursuant to Section 9.01);
(iv) any amounts required to be transferred from the REO
Account pursuant to Section 3.16(c);
(v) any amounts required to be deposited by the Servicer
pursuant to Section 3.06 in connection with losses incurred with
respect to Permitted Investments of funds held in the Certificate
Account; and
(vi) any amounts required to be deposited by the Servicer or
the Special Servicer pursuant to Section 3.07(b) in connection with
losses resulting from a deductible clause in a blanket hazard policy.
The foregoing requirements for deposit in the Certificate Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, actual payments from Mortgagors in the nature of
Escrow Payments, charges for beneficiary statements or demands, assumption
fees, modification fees, extension fees or amounts collected for
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mortgagor checks returned for insufficient funds need not be deposited by the
Servicer in the Certificate Account. If the Servicer shall deposit in the
Certificate Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Certificate Account, any provision
herein to the contrary notwithstanding. Assumption, extension and modification
fees actually received from Mortgagors on Mortgage Loans or Specially Serviced
Mortgage Loans shall be promptly delivered to the Special Servicer as
additional servicing compensation, but only to the extent the payment of such
fees are in accordance with the second paragraph of Section 3.11(b) and any
other terms hereof.
Upon receipt of any of the foregoing amounts with respect to any
Specially Serviced Mortgage Loans, the Special Servicer shall remit within 1
Business Day such amounts to the Servicer for deposit into the Certificate
Account in accordance with the second preceding paragraph. Any such amounts
received by the Special Servicer with respect to an REO Property shall be
deposited by the Special Servicer into the REO Account and remitted to the
Servicer for deposit into the Certificate Account pursuant to Section 3.16(c).
With respect to any such amounts paid by check to the order of the Special
Servicer, the Special Servicer shall endorse without recourse or warranty such
check to the order of the Servicer and shall promptly deliver any such check to
the Servicer by overnight courier.
Funds in the Certificate Account may be invested in Permitted
Investments in accordance with the provisions of Section 3.06. The Servicer
shall give notice to the Trustee, the Special Servicer and the Depositor of the
location of the Certificate Account as of the Closing Date and of the new
location of the Certificate Account prior to any change thereof.
(b) The Paying Agent, on behalf of the Trustee, shall establish and
maintain the Lower-Tier Distribution Account and the Upper-Tier Distribution
Account in trust for the benefit of the Certificateholders. The Trustee hereby
authorizes the Paying Agent to make deposits in and withdrawals from the
Distribution Accounts in accordance with the terms of this Agreement. The
Servicer shall deliver to the Paying Agent each month on or before the P&I
Advance Date therein, for deposit in the Lower-Tier Distribution Account, that
portion of the Available Distribution Amount (calculated without regard to
clause (a)(iv), (a)(v), (a)(vi) and (c) of the definition thereof) for the
related Distribution Date then on deposit in the Certificate Account.
In addition to the amounts required to be deposited in the Lower-Tier
Distribution Account pursuant to the foregoing paragraph, the Servicer shall,
as and when required hereunder, deliver to the Paying Agent for deposit in the
Lower-Tier Distribution Account:
(i) any amounts required to be deposited by the Servicer
pursuant to Section 3.06 in connection with losses incurred with
respect to Permitted Investments of funds held in the Lower-Tier
Distribution Account;
(ii) any P&I Advances required to be made by the Servicer in
accordance with Section 4.03;
(iii) any Liquidation Proceeds paid by the Servicer, the
Holders of the Controlling Class, the Holders of the Class [LR]
Certificates or the Depositor in
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connection with the purchase of all of the Mortgage Loans and any REO
Properties in the Trust Fund pursuant to Section 9.01 (exclusive of
that portion thereof required to be deposited in the Certificate
Account pursuant to Section 9.01);
(iv) any Yield Maintenance Charges or Prepayment Premiums;
and
(v) any other amounts required to be so delivered for deposit
in the Lower-Tier Distribution Account pursuant to any provision of
this Agreement.
The Paying Agent shall, upon receipt, deposit in the Lower-Tier
Distribution Account any and all amounts received by the Paying Agent that are
required by the terms of this Agreement to be deposited therein. In the event
the Trustee receives any amounts required to be remitted to the Paying Agent or
the Lower-Tier Distribution Account pursuant to the terms hereof, the Trustee
shall remit such amounts as soon as possible, but in no event later than 1
Business Day following receipt. The Trustee shall remit to the Paying Agent for
deposit in the Lower-Tier Distribution Account any P&I Advances required to be
made by it or the Fiscal Agent, as the case may be, in accordance with Section
7.05.
Immediately after the deposit of all funds in the Lower-Tier
Distribution Account and prior to the close of business on such P&I Advance
Date, the Paying Agent shall deposit in the Upper-Tier Distribution Account an
aggregate amount of immediately available funds equal to the Lower-Tier
Distribution Amount and the amount of any Prepayment Premiums and Yield
Maintenance Charges for such Distribution Date allocated in payment of the
Uncertificated Lower-Tier Interests as specified in Sections 4.01(b) and
4.01(d), respectively.
Pursuant to Section 3.06, the Servicer shall deliver to the Paying
Agent for deposit in the Upper-Tier Distribution Account any amounts required
to be deposited therein in connection with losses incurred with respect to
Permitted Investments of funds held in the Upper-Tier Distribution Account.
Funds on deposit in the Upper-Tier Distribution Account, the
Lower-Tier Distribution Account and/or the Certificate Account may be invested
in Permitted Investments in accordance with the provisions of Section 3.06. As
of the Closing Date, the Certificate Account shall be located at the offices of
the Servicer. The Servicer shall give notice to the Trustee, the Paying Agent,
the Special Servicer and the Depositor of the location of the Certificate
Account and of any new location of the Certificate Account prior to any change
thereof. As of the Closing Date, the Upper-Tier Distribution Account and the
Lower-Tier Distribution Account shall be located at the offices of the Paying
Agent. The Paying Agent shall give notice to the Trustee, the Servicer and the
Depositor of the location of the Upper-Tier Distribution Account and the
Lower-Tier Distribution Account and of the new location of the Distribution
Accounts prior to any change thereof.
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SECTION 3.05. Permitted Withdrawals From the Certificate Account and the
Distribution Accounts.
(a) The Servicer may, from time to time, make withdrawals from the
Certificate Account for any of the following purposes:
(i) to remit to the Paying Agent for deposit in the
Lower-Tier Distribution Account the amounts required to be remitted
pursuant to the first paragraph of Section 3.04(b) or that may be
applied to make P&I Advances pursuant to Section 4.03(a);
(ii) to pay itself unpaid Servicing Fees and the Special
Servicer unpaid Special Servicing Fees, Liquidation Fees and Workout
Fees in respect of each Mortgage Loan, Specially Serviced Mortgage
Loan and REO Loan, as applicable, the Servicer's rights to payment
pursuant to this clause (ii) with respect to any Mortgage Loan,
Specially Serviced Mortgage Loan or REO Loan, as applicable, being
limited to amounts received on or in respect of such Mortgage Loan
(whether in the form of payments, Liquidation Proceeds or Insurance
and Condemnation Proceeds) or such REO Loan (whether in the form of
REO Revenues, Liquidation Proceeds or Insurance and Condemnation
Proceeds) that are allocable as a recovery of interest thereon;
(iii) to reimburse itself, the Trustee or the Fiscal Agent,
as applicable (in reverse of such order with respect to any Mortgage
Loan), for ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, the Servicer's, the Trustee's or
the Fiscal Agent's right to reimburse itself pursuant to this clause
(iii) being limited to amounts received which represent Late
Collections of interest (net of the related Servicing Fees) on and
principal of the particular Mortgage Loans and REO Loans with respect
to which such P&I Advances were made;
(iv) to reimburse itself, the Trustee or the Fiscal Agent, as
applicable (in reverse of such order with respect to any Mortgage
Loan), for unreimbursed Servicing Advances, the Servicer's, the
Trustee's or the Fiscal Agent's respective rights to receive payment
pursuant to this clause (iv) with respect to any Mortgage Loan or REO
Property being limited to, as applicable, related payments,
Liquidation Proceeds, Insurance and Condemnation Proceeds and REO
Revenues;
(v) to reimburse itself, the Trustee or the Fiscal Agent, as
applicable (in reverse of such order with respect to any Mortgage
Loan), for Nonrecoverable Advances out of general collections on the
Mortgage Loans and REO Properties;
(vi) at such time as it reimburses itself, the Trustee or the
Fiscal Agent, as applicable (in reverse of such order with respect to
any Mortgage Loan), for (a) any ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advance pursuant to
clause (iii) above, to pay itself, the Trustee or the Fiscal Agent, as
applicable, any interest accrued and payable thereon in accordance
with Section 4.03(d), (b) any unreimbursed Servicing Advances pursuant
to clause (iv) above, to pay itself, the Trustee or the Fiscal Agent,
as the case may be, any interest accrued and payable thereon in
accordance with Section 3.03(d) or (c) any
58
Nonrecoverable Advances pursuant to clause (v) above, to pay itself,
the Trustee or the Fiscal Agent, as the case may be, any interest
accrued and payable thereon;
(vii) to reimburse itself, the Special Servicer, the
Depositor or the Trustee, as the case may be, for any unreimbursed
expenses reasonably incurred by such Person in respect of any Breach
or Defect giving rise to a repurchase obligation of any Mortgage Loan
Seller under Section 3 of the related Mortgage Loan Purchase
Agreement, including, without limitation, any expenses arising out of
the enforcement of the repurchase obligation, each such Person's right
to reimbursement pursuant to this clause (vii) with respect to any
Mortgage Loan being limited to that portion of the Purchase Price paid
for such Mortgage Loan that represents such expense in accordance with
clause (iv) of the definition of Purchase Price;
(viii) in accordance with Section 2.03(d), to reimburse
itself or the Trustee, as the case may be, out of general collections
on the Mortgage Loans and REO Properties for any unreimbursed expense
reasonably incurred by such Person in connection with the enforcement
of any Mortgage Loan Seller's obligations under Section 3 of the
Mortgage Loan Purchase Agreements, but only to the extent that such
expenses are not reimbursable pursuant to clause (vii) above or
otherwise;
(ix) to pay for costs and expenses incurred by the Trust Fund
pursuant to Section 3.09(c) out of general collections on the Mortgage
Loans and REO Properties;
(x) to pay itself, as additional servicing compensation in
accordance with Section 3.11(a), (a) interest and investment income
earned in respect of amounts relating to the Trust Fund held in the
Certificate Account as provided in Section 3.06(b) (but only to the
extent of the Net Investment Earnings with respect to the Certificate
Account for any period from any Distribution Date to the immediately
succeeding P&I Advance Date) and (b) Penalty Charges on Mortgage Loans
(other than Specially Serviced Mortgage Loans), but only to the extent
collected from the related Mortgagor and to the extent that all
amounts then due and payable with respect to the related Mortgage Loan
have been paid and are not needed to pay interest on Advances; and to
pay the Special Servicer, as additional servicing compensation in
accordance with the second paragraph of Section 3.11(b), Penalty
Charges on Specially Serviced Mortgage Loans (but only to the extent
collected from the related Mortgagor and to the extent that all
amounts then due and payable with respect to the related Specially
Serviced Mortgage Loan have been paid);
(xi) to recoup any amounts deposited in the Certificate
Account in error;
(xii) to pay itself, the Special Servicer, the Depositor, the
Extension Adviser or any of their respective directors, officers,
employees and agents, as the case may be, any amounts payable to any
such Person pursuant to Sections 6.03(a) or 6.03(b);
(xiii) to pay for (a) the cost of the Opinions of Counsel
contemplated by Section 10.01(f) to the extent payable out of the
Trust Fund, (b) the cost of any Opinion of Counsel contemplated by
Sections 11.01(a) or 11.01(c) in connection with an amendment
59
to this Agreement requested by the Trustee or the Servicer, which
amendment is in furtherance of the rights and interests of
Certificateholders and (c) the cost of obtaining the REO Extension
contemplated by Section 3.16(a);
(xiv) to pay out of general collections on the Mortgage Loans
and REO Properties any and all federal, state and local taxes imposed
on the Upper-Tier REMIC, the Lower-Tier REMIC or either of their
assets or transactions, together with all incidental costs and
expenses, to the extent that none of the Servicer, the Special
Servicer, the Fiscal Agent or the Trustee is liable therefor pursuant
to Section 10.01(g);
(xv) to reimburse the Servicer out of general collections on
the Mortgage Loans and REO Properties for expenses incurred by and
reimbursable to it by the Trust Fund pursuant to Section 10.01(c);
(xvi) to pay itself, the Special Servicer, or the Mortgage
Loan Sellers, as the case may be, with respect to each Mortgage Loan,
if any, previously purchased by such Person pursuant to this
Agreement, all amounts received thereon subsequent to the date of
purchase; and
(xvii) to clear and terminate the Certificate Account at the
termination of this Agreement pursuant to Section 9.01.
The Servicer shall keep and maintain separate accounting records, on a
loan-by-loan and property-by-property basis when appropriate, for the purpose
of justifying any withdrawal from the Certificate Account.
(b) The Paying Agent, on behalf of the Trustee, may, from time to
time, make withdrawals from the Lower-Tier Distribution Account for any of the
following purposes:
(i) to make deposits of the Lower-Tier Distribution Amount
pursuant to Section 4.01(b) and the amount of any Prepayment Premium
and Yield Maintenance Charges distributable pursuant to Section
4.01(d) in the Upper-Tier Distribution Account;
(ii) to pay the Servicer, as additional servicing
compensation in accordance with the second paragraph of Section
3.11(a), interest and investment income earned in respect of amounts
relating to the Trust Fund held in the Lower-Tier Distribution Account
as provided in Section 3.06(b) (but only to the extent of the Net
Investment Earnings with respect to the Lower-Tier Distribution
Account for any period from any Distribution Date to the immediately
succeeding P&I Advance Date);
(iii) to pay the Trustee accrued but unpaid Trustee Fees;
(iv) to pay to the Trustee, the Fiscal Agent or any of their
directors, officers, employees and agents, as the case may be, any
amounts payable or reimbursable to any such Person pursuant to Section
8.05(b);
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(v) to pay for the cost of the Opinion of Counsel
contemplated by Section 11.01(c) in connection with any amendment to
this Agreement requested by the Trustee; and
(vi) to clear and terminate the Lower-Tier Distribution
Account at the termination of this Agreement pursuant to Section 9.01.
(c) The Paying Agent, on behalf of the Trustee, may make withdrawals
from the Upper-Tier Distribution Account for any of the following purposes:
(i) to make distributions to Certificateholders (other than
Holders of the Class [LR] Certificates) on each Distribution Date
pursuant to Section 4.01 or 9.01, as applicable;
(ii) to pay the Servicer, as additional servicing
compensation in accordance with the second paragraph of Section
3.11(a), interest and investment income earned in respect of amounts
held in the Upper-Tier Distribution Account as provided in Section
3.06(b) (but only to the extent of the Net Investment Earnings with
respect to the Upper-Tier Distribution Account for any period from any
Distribution Date to the immediately succeeding P&I Advance Date); and
(iii) to clear and terminate the Upper-Tier Distribution
Account at the termination of this Agreement pursuant to Section 9.01.
(d) Notwithstanding anything herein to the contrary, if amounts on
deposit in the Certificate Account and the Lower-Tier Distribution Account are
not sufficient to pay all of the amounts listed in Sections 3.05(a) and (b),
then the items (iii) and (iv) of Section 3.05(b) shall be paid in full prior to
the payment of any fees or reimbursement of any expenses of the Servicer
payable under Section 3.05(a).
SECTION 3.06. Investment of Funds in the Certificate Account, the Distribution
Accounts and the REO Account.
(a) The Servicer may direct any depository institution maintaining the
Certificate Account, the Upper-Tier Distribution Account or the Lower-Tier
Distribution Account (each, for purposes of this Section 3.06, an "Investment
Account") and the Special Servicer may direct any depository institution
maintaining the REO Account (also for purpose of this Section 3.06, an
"Investment Account") to invest, or if it is such depository institution, may
itself invest, the funds held therein in one or more Permitted Investments
bearing interest or sold at a discount, and maturing, unless payable on demand,
(i) no later than the Business Day immediately preceding the next succeeding
date on which such funds are required to be withdrawn from such account
pursuant to this Agreement, if a Person other than the depository institution
maintaining such account is the obliger thereon and (ii) no later than the date
on which such funds are required to be withdrawn from such account pursuant to
this Agreement, if the depository institution maintaining such account is the
obligor thereon. All such Permitted Investments shall be held to maturity,
unless payable on demand. Any investment of funds in an Investment
61
Account shall be made in the name of the Trustee (in its capacity as such). The
Servicer (in the case of the Certificate Account) or the Special Servicer (in
the case of the REO Account), on behalf of the Trustee, shall maintain
continuous possession of any Permitted Investment of amounts in the Certificate
Account or REO Account that is either (i) a "certificated security," as such
term is defined in the UCC or (ii) other property in which a secured party may
perfect its security interest by possession under the UCC or any other
applicable law. Possession of any such Permitted Investment by the Servicer or
the Special Servicer shall constitute possession by a person designated by the
Trustee for purposes of Section 8-313 of the UCC and possession by the Trustee,
as secured party, for purposes of Section 9-305 of the UCC and any other
applicable law. Except as otherwise provided herein, the Trustee shall have
sole control (except with respect to investment direction) over Permitted
Investments of amounts in the Distribution Accounts. In the event amounts on
deposit in an Investment Account are at any time invested in a Permitted
Investment payable on demand, the Servicer (in the case of the Certificate
Account), the Special Servicer (in the case of the REO Account) or the Paying
Agent (in the case of the Distribution Accounts) shall:
(i) consistent with any notice required to be given
thereunder, demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an amount equal
to the lesser of (a) all amounts then payable thereunder and (b) the
amount required to be withdrawn on such date; and
(ii) demand payment of all amounts due thereunder promptly
upon determination by the Servicer, the Special Servicer or the
Trustee, as the case may be, that such Permitted Investment would not
constitute a Permitted Investment in respect of funds thereafter on
deposit in the Investment Account.
(b) Interest and investment income realized on funds deposited in each
of the Certificate Account and the Distribution Accounts, to the extent of the
Net Investment Earnings, if any, with respect to such account for each period
from any Distribution Date to the immediately succeeding P&I Advance Date,
shall be for the sole and exclusive benefit of the Servicer and shall be
subject to its withdrawal, or withdrawal at its direction, in accordance with
Section 3.05(a), 3.05(b) or 3.05(c), as the case may be. Interest and
investment income realized on funds deposited in the REO Account, to the extent
of the Net Investment Earnings, if any, with respect to such account for each
period from any Distribution Date to the immediately succeeding P&I Advance
Date, shall be for the sole and exclusive benefit of the Trust Fund and shall
be subject to its withdrawal in accordance with Section 3.16(c). In the event
that any loss shall be incurred in respect of any Permitted Investment on
deposit in any of the Certificate Account, the Distribution Accounts or the REO
Account, the Servicer (in the case of the Certificate Account and the
Distribution Accounts) or the Special Servicer (in the case of the REO Account)
shall deposit therein, no later than the P&I Advance Date, without right of
reimbursement, the amount of the Net Investment Loss, if any, with respect to
such account for the period from the immediately preceding Distribution Date to
such P&I Advance Date.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment,
or if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to
62
Section 8.02, upon the request of Holders of Certificates entitled to a
majority of the Voting Rights allocated to any Class shall, take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.
SECTION 3.07. Maintenance of Insurance Policies; Errors and Omissions and
Fidelity Coverage.
(a) The Servicer shall use its reasonable best efforts to cause the
Mortgagor to maintain, to the extent required by the terms of the related
Mortgage Note, or if the Mortgagor does not so maintain, shall itself maintain,
for each Mortgage Loan all Insurance Policy coverage as is required under the
related Mortgage (to the extent that the Trustee has an insurable interest and
such Insurance Policy coverage is available at commercially reasonable rates,
consistent with the Servicing Standard); provided, however, that if any
Mortgage permits the holder thereof to dictate to the Mortgagor the Insurance
Policy coverage to be maintained on such Mortgaged Property, the Servicer shall
impose such insurance requirements as are consistent with the Servicing
Standards. Subject to Section 3.17(a), the Special Servicer shall maintain for
each REO Property no less Insurance Policy coverage than was previously
required of the Mortgagor under the related Mortgage Loan. All such Insurance
Policies shall (i) contain a "standard" mortgagee clause, with loss payable to
the Servicer on behalf of the Trustee (in the case of insurance maintained in
respect of Mortgage Loans other than REO Properties), (ii) be in the name of
the Special Servicer (in the case of insurance maintained in respect of REO
Properties) on behalf of the Trustee, (iii) include coverage in an amount not
less than the lesser of the full replacement cost of the REO Property or the
outstanding principal balance owing on the related REO Loan, (iv) include a
replacement cost endorsement providing no deduction for depreciation (unless
such endorsement is not permitted under the related Mortgage Loan documents)
and (v) be issued by a Qualified Insurer authorized under applicable law to
issue such Insurance Policies. Any amounts collected by the Servicer or the
Special Servicer under any such Insurance Policies (other than amounts to be
applied to the restoration or repair of the related Mortgaged Property or REO
Property or amounts to be released to the related Mortgagor, in each case in
accordance with the Servicing Standards and the provisions of the related
Mortgage Loan) shall be deposited in the Certificate Account, subject to
withdrawal pursuant to Section 3.05(a). Any costs incurred by the Servicer in
maintaining any such Insurance Policies in respect of Mortgage Loans (other
than REO Properties) (i) if the Mortgagor defaults on its obligation to do so,
shall be advanced by the Servicer as a Servicing Advance and will be charged to
the related Mortgagor and (ii) shall not, for purposes thereof, including,
without limitation, calculating monthly distributions to Certificateholders, be
added to the unpaid principal balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit. Any cost
incurred by the Special Servicer in maintaining any such Insurance Policies
with respect to REO Properties shall be an expense of the Trust payable out of
the related REO Account pursuant to Section 3.16(c) or, if the amount on
deposit therein is insufficient therefor, advanced by the Servicer as a
Servicing Advance.
(b) (i) If the Servicer or the Special Servicer shall obtain and
maintain a blanket Insurance Policy with a Qualified Insurer insuring
against fire and hazard losses on all of the Mortgage Loans or REO
Properties, as the case may be, required to be serviced and
administered hereunder, then, to the extent such Insurance Policy
provides protection
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equivalent to the individual policies otherwise required, the Servicer
or the Special Servicer shall conclusively be deemed to have satisfied
its obligation to cause fire and hazard insurance to be maintained on
the related Mortgaged Properties or REO Properties. Such Insurance
Policy may contain a deductible clause, in which case the Servicer or
the Special Servicer shall, if there shall not have been maintained on
the related Mortgaged Property or REO Property a fire and hazard
Insurance Policy complying with the requirements of Section 3.07(a),
and there shall have been one or more losses which would have been
covered by such Insurance Policy, promptly deposit into the
Certificate Account from its own funds the amount of such loss or
losses that would have been covered under the individual policy but
are not covered under the blanket Insurance Policy because of such
deductible clause to the extent that any such deductible exceeds the
deductible limitation that pertained to the related Mortgage Loan, or
in the absence of such deductible limitation, the deductible
limitation which is consistent with the Servicing Standard. In
connection with its activities as administrator and servicer of the
Mortgage Loans, the Servicer agrees to prepare and present, on behalf
of itself, the Trustee and Certificateholders, claims under any such
blanket Insurance Policy in a timely fashion in accordance with the
terms of such policy. The Special Servicer, to the extent consistent
with the Servicing Standards, may maintain, at its own expense,
earthquake insurance on REO Properties, provided coverage is available
at commercially reasonable rates.
(ii) If the Servicer or the Special Servicer shall cause any
Mortgaged Property or REO Property to be covered by a master single
interest insurance policy with a Qualified Insurer naming the Servicer
or the Special Servicer on behalf of the Trustee as the loss payee,
then to the extent such Insurance Policy provides protection
equivalent to the individual policies otherwise required, the Servicer
or the Special Servicer shall conclusively be deemed to have satisfied
its obligation to cause such insurance to be maintained on the related
Mortgage Properties and REO Properties. In the event the Servicer or
the Special Servicer shall cause any Mortgaged Property or REO
Property to be covered by such master single interest insurance
policy, the incremental costs of such insurance applicable to such
Mortgaged Property or REO Property (i.e., other than any minimum or
standby premium payable for such policy whether or not any Mortgaged
Property or REO Property is covered thereby) shall be paid by the
Servicer as a Servicing Advance. Such master single interest policy
may contain a deductible clause, in which case the Servicer or the
Special Servicer shall, in the event that there shall not have been
maintained on the related Mortgaged Property or REO Property a policy
otherwise complying with the provisions of Section 3.07(a), and there
shall have been one or more losses which would have been covered by
such policy had it been maintained, deposit into the Certificate
Account from its own funds the amount not otherwise payable under the
master single interest policy because of such deductible clause, to
the extent that any such deductible exceeds the deductible limitation
that pertained to the related Mortgage Loan, or, in the absence of any
such deductible limitation, the deductible limitation which is
consistent with the Servicing Standard.
(c) Each of the Servicer and the Special Servicer shall obtain and
maintain at its own expense and keep in full force and effect throughout the
term of this Agreement a blanket fidelity
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bond and an errors and omissions Insurance Policy with a Qualified Insurer
covering the Servicer's and the Special Servicer's, as applicable, officers and
employees and other persons acting on behalf of the Servicer and the Special
Servicer in connection with its activities under this Agreement with a
deductible clause that in no event exceeds the greater of (i) $100,000 or (ii)
5% of the face amount of the Fidelity Bond or errors and omission policy as the
case may be. The Servicer or the Special Servicer, as applicable, shall cause
the Trustee, on behalf of the Trust, to be named as a loss payee on each such
fidelity bond and errors and omissions policy. Notwithstanding the foregoing,
so long as the long term debt or the deposit obligations or claims-paying
ability of the Servicer (or its immediate or remote parent) is rated at least
"A" by _______________ and "A" by _______________ (if rated by
_______________), the Servicer shall be allowed to provide self-insurance with
respect to a fidelity bond. The amount of coverage shall be at least equal to
the coverage that would be required by FNMA or FHLMC, whichever is greater,
with respect to the Servicer or the Special Servicer if the Servicer or the
Special Servicer, as applicable, were servicing and administering the Mortgage
Loans or Specially Serviced Mortgage Loans, as applicable, for FNMA or FHLMC.
Coverage of the Servicer or the Special Servicer under a policy or bond
obtained by an Affiliate of the Servicer or the Special Servicer and providing
the coverage required by this Section 3.07(c) shall satisfy the requirements of
this Section 3.07(c). The Special Servicer and the Servicer will promptly
report in writing to the Trustee any material changes that may occur in their
respective fidelity bonds, if any, and/or their respective errors and omissions
Insurance Policies, as the case may be, and will furnish to the Trustee copies
of all binders and policies or certificates evidencing that such bonds, if any,
and insurance policies are in full force and effect.
(d) During all such times as any Mortgaged Property shall be in a
federally designated special flood hazard area (and such flood insurance has
been made available), the Servicer will use its reasonable best efforts to
cause the related Mortgagor (in accordance with applicable law and the terms of
the Mortgage Loan documents) to maintain, and, if the related Mortgagor shall
default in its obligation to so maintain, shall itself maintain to the extent
available at commercially reasonable rates (as determined by the Servicer in
accordance with the Servicing Standards), flood insurance in respect thereof,
but only to the extent the related Mortgage Loan permits the mortgagee to
require such coverage and the maintenance of such coverage is consistent with
the Servicing Standards. Such flood insurance shall be in an amount equal to
the lesser of (i) the unpaid principal balance of the related Mortgage Loan,
and (ii) the maximum amount of insurance which is available under the Flood
Disaster Protection Act of 1973, as amended. If the cost of any insurance
described above is not borne by the Mortgagor, the Servicer shall promptly make
a Servicing Advance for such costs, subject to Section 3.03(c).
(e) During all such times as any REO Property shall be located in a
federally designated special flood hazard area, the Special Servicer will cause
to be maintained, to the extent available at commercially reasonable rates (as
determined by the Special Servicer in accordance with the Servicing Standards),
a flood insurance policy meeting the requirements of the current guidelines of
the Federal Insurance Administration in an amount representing coverage not
less than the maximum amount of insurance which is available under the Flood
Disaster Protection Act of 1973, as amended. The cost of any such flood
insurance with respect to an REO Property shall be an expense of the Trust
payable out of the related REO Account
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pursuant to Section 3.16(c) or, if the amount on deposit therein is
insufficient therefor, paid by the Servicer as a Servicing Advance.
SECTION 3.08. Enforcement of Due-On-Sale Clauses; Assumption Agreements.
(a) As to each Mortgage Loan which contains a provision in the nature
of a "due-on-sale" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the
mortgagee's option) become due and payable upon the sale or other
transfer of an interest in the related Mortgaged Property; or
(ii) provides that such Mortgage Loan may not be assumed
without the consent of the mortgagee in connection with any such sale
or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Special Servicer, on behalf of the Trustee as the mortgagee of record, shall
exercise (or waive its right to exercise) any right it may have with respect to
such Mortgage Loan (x) to accelerate the payments thereon or (y) to withhold
its consent to any such sale or other transfer, in a manner consistent with the
Servicing Standards.
(b) As to each Mortgage Loan which contains a provision in the nature
of a "due-on-encumbrance" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the
mortgagee's option) become due and payable upon the creation of any
additional lien or other encumbrance on the related Mortgaged
Property; or
(ii) requires the consent of the mortgagee to the creation of
any such additional lien or other encumbrance on the related Mortgaged
Property,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Special Servicer, on behalf of the Trustee as the mortgagee of record, shall
exercise (or waive its right to exercise) any right it may have with respect to
such Mortgage Loan (x) to accelerate the payments thereon or (y) to withhold
its consent to the creation of any such additional lien or other encumbrance,
in a manner consistent with the Servicing Standards.
(c) Nothing in this Section 3.08 shall constitute a waiver of the
Trustee's right, as the mortgagee of record, to receive notice of any
assumption of a Mortgage Loan, any sale or other transfer of the related
Mortgaged Property or the creation of any additional lien or other encumbrance
with respect to such Mortgaged Property.
(d) Except as otherwise permitted by Section 3.20, neither the
Servicer nor the Special Servicer shall agree to modify, waive or amend any
term of any Mortgage Loan in connection with the taking of, or the failure to
take, any action pursuant to this Section 3.08.
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(e) Notwithstanding the foregoing, the Special Servicer shall not
waive any rights under a "due-on-encumbrance" clause with respect to any
Mortgage Loan, or under any "due-on-sale" clause with respect to any of the
Mortgage Loans set forth on Schedule 2 hereto unless it obtains from each
Rating Agency a written confirmation that such waiver would not cause a
downgrading, qualification or withdrawal of the rating then assigned to any of
the Certificates; provided, however, that so long as all Holders of each Class
of Certificates the ratings of which would otherwise be downgraded, qualified
or withdrawn consent to such waiver, such Rating Agency confirmation will not
be required.
(f) Notwithstanding any other provisions of this Section 3.08, the
Servicer may grant, without any Rating Agency confirmation as provided in
clause (e) above or Special Servicer approval, a Mortgagor's request for
consent to subject the related Mortgaged Property to an easement or
right-of-way for utilities, access, parking, public improvements or another
purpose, and may consent to subordination of the related Mortgage Loan to such
easement or right-of-way provided the Servicer shall have determined in
accordance with the Servicing Standards that such easement or right-of-way
shall not materially interfere with the then-current use of the related
Mortgaged Property, or the security intended to be providing such Mortgage, or
materially or adversely affect the value of such Mortgaged Property.
SECTION 3.09. Realization Upon Defaulted Mortgage Loans.
(a) The Special Servicer shall, subject to subsections (b) through (d)
of this Section 3.09, exercise reasonable efforts, consistent with the
Servicing Standards, to foreclose upon or otherwise comparably convert (which
may include an REO Acquisition) the ownership of property securing such
Mortgage Loans, as come into and continue in default as to which no
satisfactory arrangements can be made for collection of delinquent payments,
and which are not released from the Trust Fund pursuant to any other provision
hereof. The foregoing is subject to the provision that, in any case in which a
Mortgaged Property shall have suffered damage from an Uninsured Cause, the
Servicer shall not be required to make a Servicing Advance and expend funds
toward the restoration of such property unless the Special Servicer has
determined in its reasonable discretion that such restoration will increase the
net proceeds of liquidation of such Mortgaged Property to Certificateholders
after reimbursement to the Servicer for such Servicing Advance, and the
Servicer has determined that such Servicing Advance together with accrued and
unpaid interest thereon will be recoverable by the Servicer out of the proceeds
of liquidation of such Mortgaged Property, as contemplated in Section
3.05(a)(iv). The Special Servicer shall be responsible for all other costs and
expenses incurred by it in any such proceedings (such costs and expenses to be
advanced by the Servicer to the Special Servicer), provided that, in each case,
such cost or expense would not, if incurred, constitute a Nonrecoverable
Servicing Advance. Nothing contained in this Section 3.09 shall be construed so
as to require the Servicer or the Special Servicer, on behalf of the Trust, to
make a bid on any Mortgaged Property at a foreclosure sale or similar
proceeding that is in excess of the fair market value of such property, as
determined by the Servicer or the Special Servicer in its reasonable and good
faith judgment taking into account the factors described in Section 3.18(d) and
the results of any Appraisal obtained pursuant to the following sentence, all
such bids to be made in a manner consistent with the Servicing Standards. If
and when the Special Servicer or the Servicer deems it necessary and prudent
for purposes of establishing the fair market value
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of any Mortgaged Property securing a Defaulted Mortgage Loan, whether for
purposes of bidding at foreclosure or otherwise, the Special Servicer or the
Servicer, as the case may be, is authorized to have an Appraisal performed with
respect to such property by an Independent MAI-designated appraiser the cost of
which shall be paid by the Servicer as a Servicing Advance.
(b) The Special Servicer shall not acquire any personal property
pursuant to this Section 3.09 unless either:
(i) such personal property is incident to real property
(within the meaning of Section 856(e)(1) of the Code) so acquired by
the Special Servicer; or
(ii) the Special Servicer shall have obtained an Opinion of
Counsel (the cost of which shall be a Servicing Advance) to the effect
that the holding of such personal property by the Trust Fund will not
cause the imposition of a tax on the Lower-Tier REMIC or the
Upper-Tier REMIC under the REMIC Provisions or cause the Lower-Tier
REMIC or the Upper-Tier REMIC to fail to qualify as a REMIC at any
time that any Uncertificated Lower-Tier Interest or Certificate is
outstanding.
(c) Notwithstanding the foregoing provisions of this Section 3.09,
neither the Special Servicer nor the Servicer shall, on behalf of the Trustee,
obtain title to a Mortgaged Property in lieu of foreclosure or otherwise, or
take any other action with respect to any Mortgaged Property, if, as a result
of any such action, the Trustee, on behalf of the Certificateholders, would be
considered to hold title to, to be a "mortgagee-in-possession" of, or to be an
"owner" or "operator" of such Mortgaged Property within the meaning of CERCLA
or any comparable law, unless (as evidenced by an Officer's Certificate to such
effect delivered to the Trustee) the Special Servicer has previously determined
in accordance with the Servicing Standards, based on an Environmental
Assessment of such Mortgaged Property performed by an Independent Person who
regularly conducts Environmental Assessments, that:
(i) the Mortgaged Property is in compliance with applicable
environmental laws and regulations or, if not, that taking such
actions as are necessary to bring the Mortgaged Property in compliance
therewith is reasonably likely to produce a greater recovery on a
present value basis than not taking such actions; and
(ii) there are no circumstances or conditions present at the
Mortgaged Property relating to the use, management or disposal of
Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any
applicable environmental laws and regulations or, if such
circumstances or conditions are present for which any such action
could be required, that taking such actions with respect to such
Mortgaged Property is reasonably likely to produce a greater recovery
on a present value basis than not taking such actions.
The cost of any such Environmental Assessment shall be paid by the
Servicer as a Servicing Advance, and the cost of any remedial, corrective or
other further action contemplated by clause (i) and/or clause (ii) of the
preceding sentence may be withdrawn from the Certificate
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Account at the direction of the Special Servicer as an expense of the Trust
Fund pursuant to Section 3.05(a)(ix); and if any such Environmental Assessment
so warrants, the Special Servicer shall, at the expense of the Trust Fund,
perform such additional environmental testing as it deems necessary and prudent
to determine whether the conditions described in clauses (i) and (ii) of the
preceding sentence have been satisfied.
(d) If (i) the environmental testing contemplated by subsection (c)
above establishes that either of the conditions set forth in clauses (i) and
(ii) of the first sentence thereof has not been satisfied with respect to any
Mortgaged Property securing a Defaulted Mortgage Loan and (ii) there has been
no breach of any of the representations and warranties set forth in or required
to be made pursuant to Section 2 of the Mortgage Loan Purchase Agreements for
which either Mortgage Loan Seller could be required to repurchase such
Defaulted Mortgage Loan pursuant to Section 3 of the Mortgage Loan Purchase
Agreements, then the Special Servicer shall take such action as it deems to be
in the best economic interest of the Trust Fund (other than proceeding to
acquire title to the Mortgaged Property) and is hereby authorized at such time
as it deems appropriate to release such Mortgaged Property from the lien of the
related Mortgage.
(e) The Special Servicer shall provide written reports and a copy of
any Environmental Assessments to the Trustee, the Paying Agent and the Servicer
monthly regarding any actions taken by the Special Servicer with respect to any
Mortgaged Property securing a defaulted Mortgage Loan as to which the
environmental testing contemplated in subsection (c) above has revealed that
either of the conditions set forth in clauses (i) and (ii) of the first
sentence thereof has not been satisfied, in each case until the earlier to
occur of satisfaction of both such conditions, repurchase of the related
Mortgage Loan by the Mortgage Loan Seller or release of the lien of the related
Mortgage on such Mortgaged Property. The Trustee shall forward all such reports
to the Certificateholders and each Rating Agency promptly following the receipt
thereof. In addition, the Servicer will deliver to the Class [F], Class [G] and
Class [H] Certificateholders a copy of any such written reports and any
Environmental Assessments within 15 days after receipt of such written reports
and Environmental Assessments from the Special Servicer.
(f) The Servicer shall report to the Internal Revenue Service and the
related Mortgagor, in the manner required by applicable law, the information
required to be reported regarding any Mortgaged Property which is abandoned or
foreclosed and the Servicer shall report, via Form 1099C, all forgiveness of
indebtedness. The Special Servicer shall provide the Servicer with such
information or reports that the Servicer deems necessary to fulfill its
obligations under this paragraph (f) promptly upon the Servicer's request
therefor. The Servicer shall deliver a copy of any such report to the Trustee
and the Special Servicer.
(g) The Special Servicer shall have the right to determine, in
accordance with the Servicing Standards, the advisability of the maintenance of
an action to obtain a deficiency judgment if the state in which the Mortgaged
Property is located and the terms of the Mortgage Loan permit such an action.
(h) The Special Servicer shall maintain accurate records, prepared by
one of its Servicing Officers, of each Final Recovery Determination in respect
of a Defaulted Mortgage
69
Loan or REO Property and the basis thereof. Each Final Recovery Determination
shall be evidenced by an Officer's Certificate delivered to the Trustee and the
Servicer no later than the next succeeding P&I Advance Determination Date.
SECTION 3.10. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by
the Servicer or the Special Servicer, as the case may be, of a notification
that payment in full shall be escrowed in a manner customary for such purposes,
the Servicer or Special Servicer, as the case may be, will immediately notify
the Trustee and request delivery of the related Mortgage File. Any such notice
and request shall be in the form of a Request for Release signed by a Servicing
Officer and shall include a statement to the effect that all amounts received
or to be received in connection with such payment which are required to be
deposited in the Certificate Account pursuant to Section 3.04(a) or remitted to
the Servicer to enable such deposit, have been or will be so deposited. Within
seven Business Days (or within such shorter period as release can reasonably be
accomplished if the Servicer notifies the Trustee of an exigency) of receipt of
such notice and request, the Trustee shall release, or cause any related
Custodian to release, the related Mortgage File to the Servicer or Special
Servicer, as the case may be. No expenses incurred in connection with any
instrument of satisfaction or deed of reconveyance shall be chargeable to the
Certificate Account.
(b) From time to time as is appropriate for servicing or foreclosure
of any Mortgage Loan, the Servicer or the Special Servicer shall deliver to the
Trustee a Request for Release signed by a Servicing Officer. Upon receipt of
the foregoing, the Trustee shall deliver or cause the related Custodian to
deliver, the Mortgage File or any document therein to the Servicer or the
Special Servicer (or a designee), as the case may be. Upon return of such
Mortgage File or such document to the Trustee or the related Custodian, or the
delivery to the Trustee of a certificate of a Servicing Officer of the Servicer
or the Special Servicer, as the case may be, stating that such Mortgage Loan
was liquidated and that all amounts received or to be received in connection
with such liquidation which are required to be deposited into the Certificate
Account pursuant to Section 3.04(a) have been or will be so deposited, or that
such Mortgage Loan has become an REO Property, a copy of the Request for
Release shall be released by the Trustee to the Servicer or the Special
Servicer (or a designee), as the case may be, with the original being released
upon termination of the Trust.
(c) Within seven Business Days (or within such shorter period as
delivery can reasonably be accomplished if the Special Servicer notifies the
Trustee of an exigency) of receipt thereof, the Trustee shall execute and
deliver to the Special Servicer any court pleadings, requests for trustee's
sale or other documents necessary to the foreclosure or trustee's sale in
respect of a Mortgaged Property or to any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment, or to enforce any other remedies or rights provided by the
Mortgage Note or Mortgage or otherwise available at law or in equity. The
Special Servicer shall be responsible for the preparation of all such documents
and pleadings. When submitted to the Trustee for signature, such documents or
pleadings shall be accompanied by a certificate of a Servicing Officer
requesting that such pleadings or documents be executed by the Trustee and
certifying as to the reason such
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documents or pleadings are required and that the execution and delivery thereof
by the Trustee will not invalidate or otherwise affect the lien of the
Mortgage, except for the termination of such a lien upon completion of the
foreclosure or trustee's sale.
SECTION 3.11. Servicing Compensation.
(a) As compensation for its activities hereunder, the Servicer shall
be entitled to receive the Servicing Fee with respect to each Mortgage Loan and
REO Loan. As to each Mortgage Loan and REO Loan, the Servicing Fee shall accrue
from time to time at the Servicing Fee Rate (in accordance with the same terms
of the related Mortgage Note as are applicable to the accrual of interest at
the Mortgage Rate) and shall be computed on the basis of the Stated Principal
Balance of such Mortgage Loan and for the same period respecting which any
related interest payment due on such Mortgage Loan or deemed to be due on such
REO Loan is computed. The Servicing Fee with respect to any Mortgage Loan or
REO Loan shall cease to accrue if a Liquidation Event occurs in respect
thereof. The Servicing Fee shall be payable monthly, on a loan-by-loan basis,
from payments of interest on each Mortgage Loan and REO Revenues allocable as
interest on each REO Loan. The Servicer shall be entitled to recover unpaid
Servicing Fees in respect of any Mortgage Loan or REO Loan out of that portion
of related payments, Insurance and Condemnation Proceeds, Liquidation Proceeds
and REO Revenues (in the case of an REO Loan) allocable as recoveries of
interest, to the extent permitted by Section 3.05(a). The right to receive the
Servicing Fee may not be transferred in whole or in part except in connection
with the transfer of all of the Servicer's responsibilities and obligations
under this Agreement. The Servicer shall pay, from its own funds, the annual
fees of each Rating Agency.
Additional servicing compensation in the form of one-half of all
assumption and modification fees paid by the Mortgagor on Mortgage Loans that
are not Specially Serviced Mortgage Loans and only to the extent that all
amounts then due and payable with respect to the related Mortgage Loan
(including interest on Advances) have been paid, and charges for beneficiary
statements or demands and amounts collected for checks returned for
insufficient funds, in each case only to the extent actually paid by the
related Mortgagor, shall be retained by the Servicer and shall not be required
to be deposited in the Certificate Account pursuant to Section 3.04(a). The
Servicer shall also be entitled to additional servicing compensation in the
form of: (i) Penalty Charges received on the Mortgage Loans (other than
Specially Serviced Mortgage Loans), but only to the extent actually paid by the
related Mortgagor and to the extent that all amounts then due and payable with
respect to the related Mortgage Loan (including interest on Advances) have been
paid; (ii) interest or other income earned on deposits relating to the Trust
Fund in the Certificate Account and the Distribution Accounts in accordance
with Section 3.06(b) (but only to the extent of the Net Investment Earnings, if
any, with respect to each such account for each period from any Distribution
Date to the immediately succeeding P&I Advance Date); and (iii) interest earned
on deposits in the Servicing Account which are not required by applicable law
or the related Mortgage Loan to be paid to the Mortgagor. The Servicer shall be
required to pay out of its own funds all expenses incurred by it in connection
with its servicing activities hereunder (including, without limitation, payment
of any amounts due and owing to any of its Sub-Servicers and the premiums for
any blanket Insurance Policy insuring against hazard losses pursuant to Section
3.07), if and to the extent such expenses are
71
not payable directly out of the Certificate Account, and the Servicer shall not
be entitled to reimbursement therefor except as expressly provided in this
Agreement.
(b) As compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Special Servicing Fee with respect to each
Specially Serviced Mortgage Loan and REO Loan. As to each Specially Serviced
Mortgage Loan and REO Loan, the Special Servicing Fee shall accrue from time to
time at the Special Servicing Fee Rate (in accordance with the same terms of
the related Mortgage Note as are applicable to the accrual of interest at the
Mortgage Rate) and shall be computed on the basis of the Stated Principal
Balance of such Specially Serviced Mortgage Loan and for the same period
respecting which any related interest payment due on such Specially Serviced
Mortgage Loan or deemed to be due on such REO Loan is computed. The Special
Servicing Fee with respect to any Specially Serviced Mortgage Loan or REO Loan
shall cease to accrue if a Liquidation Event occurs in respect thereof. The
Special Servicing Fee shall be payable monthly, on a loan-by-loan basis, to the
extent permitted by Section 3.05(a). The right to receive the Special Servicing
Fee may not be transferred in whole or in part except in connection with the
transfer of all of the Special Servicer's responsibilities and obligations
under this Agreement.
Additional servicing compensation in the form of one-half of all
assumption and modification fees and all extension fees received on or with
respect to any Mortgage Loan and all modification, assumption and extension
fees received on Specially Serviced Mortgage Loans, but only to the extent
actually collected from the related Mortgagor and only to the extent that all
amounts then due and payable with respect to the related Mortgage Loan
(including those payable to the Servicer pursuant to Section 3.11(a)) have been
paid, shall be promptly paid to the Special Servicer by the Servicer and shall
not be required to be deposited in the Certificate Account pursuant to Section
3.04(a). The Special Servicer shall also be entitled to additional servicing
compensation in the form of a Workout Fee with respect to each Corrected
Mortgage Loan at the Workout Fee Rate on such Mortgage Loan for so long as it
remains a Corrected Mortgage Loan. The Workout Fee with respect to any
Corrected Mortgage Loan will cease to be payable if such loan again becomes a
Specially Serviced Mortgage Loan; provided that a new Workout Fee will become
payable if and when such Mortgage Loan again becomes a Corrected Mortgage Loan.
If the Special Servicer is terminated (other than for cause or by resignation),
it shall retain the right to receive any and all Workout Fees payable with
respect to Mortgage Loans that became Corrected Mortgage Loans during the
period that it acted as Special Servicer and were Corrected Mortgage Loans at
the time of such termination (and the successor Special Servicer shall not be
entitled to any portion of such Workout Fees), in each case until the Workout
Fee for any such loan ceases to be payable in accordance with the terms hereof.
A Liquidation Fee will be payable with respect to each Specially Serviced
Mortgage Loan as to which the Special Servicer receives any Liquidation
Proceeds subject to the exceptions set forth in the definition of Liquidation
Fee. Notwithstanding anything to the contrary described above, no Liquidation
Fee will be payable based on, or out of, Liquidation Proceeds received in
connection with the repurchase of any Mortgage Loan by the Mortgage Loan Seller
for a breach of representation or warranty or for defective or deficient
Mortgage Loan documentation, the purchase of any Specially Serviced Mortgage
Loan by the Servicer or the Special Servicer or the purchase of all of the
Mortgage Loans and REO Properties in connection with an optional termination of
the Trust Fund pursuant to Section 9.01. If, however, Liquidation Proceeds are
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received with respect to any Corrected Mortgage Loan and the Special Servicer
is properly entitled to a Workout Fee, such Workout Fee will be payable based
on and out of the portion of such Liquidation Proceeds that constitute
principal and/or interest on such Mortgage Loan. The Special Servicer will also
be entitled to additional fees in the form of Penalty Charges on Specially
Serviced Mortgage Loans (but only to the extent actually collected from the
related Mortgagor and to the extent that all amounts then due and payable with
respect to the related Mortgage Loan (including interest on Advances) have been
paid). The Special Servicer shall be required to pay out of its own funds all
expenses incurred by it in connection with its servicing activities hereunder
(including, without limitation, payment of any amounts, other than management
fees in respect of REO Properties, due and owing to any of its Sub-Servicers
and the premiums for any blanket Insurance Policy obtained by it insuring
against hazard losses pursuant to Section 3.07), if and to the extent such
expenses are not payable directly out of the Certificate Account or the REO
Account, and the Special Servicer shall not be entitled to reimbursement
therefor except as expressly provided in this Agreement.
SECTION 3.12. Inspections; Collection of Financial Statements.
(a) The Servicer shall perform (at its own expense), or shall cause to
be performed (at its own expense), a physical inspection of each Mortgaged
Property at such times and in such manner as are consistent with the Servicing
Standards, but in any event shall inspect each Mortgaged Property securing a
Mortgage Note with a Stated Principal Balance of (a) $_________________ or more
at least once every __ months and (b) less than $_______________ at least once
every __ months, in each case commencing in the calendar year 1998; provided,
however, that if the Servicer has a reasonable basis to believe that the Debt
Service Coverage Ratio with respect to any Mortgaged Property has decreased by
25% or more from the Debt Service Coverage Ratio as of the Cut-off Date, the
Servicer shall inspect the related Mortgaged Property as soon as practicable
thereafter (the cost of which inspection shall be at the expense of the Trust
Fund); provided, further, however, that if any scheduled payment becomes more
than 60 days delinquent on the related Mortgage Loan, the Special Servicer
shall inspect the related Mortgaged Property as soon as practicable thereafter.
The cost of such inspection by the Special Servicer shall be an expense of the
Trust Fund. The Special Servicer or the Servicer, as applicable, shall prepare
a written report of each such inspection detailing the condition of the
Mortgaged Property and specifying the existence of (i) any vacancy in the
Mortgaged Property that the preparer of such report deems material, (ii) any
sale, transfer or abandonment of the Mortgaged Property, (iii) any adverse
change in the condition of the Mortgaged Property that the preparer of such
report deems material, (iv) any visible waste committed on the Mortgaged
Property, (v) a report setting forth the three most recent years operating
statements, and (vi) photographs of each inspected Mortgaged Property. The
Special Servicer shall deliver each such report to the Servicer within 40 days
of its preparation. The Servicer shall deliver to the Trustee, the Paying
Agent, each Rating Agency, the Underwriters, the Placement Agents and each
Holder of a Class [F], Class [G] and Class [H] Certificate, a copy of each such
written report that it prepared or received from the Special Servicer within 20
days of its receipt from the Special Servicer or 60 days of its preparation by
the Servicer.
(b) The Special Servicer or Servicer, as applicable, shall make
reasonable efforts to collect promptly from each Mortgagor annual operating
statements and rent rolls of the related
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Mortgaged Property, financial statements of such Mortgagor and any other
reports required to be delivered under the terms of the Mortgage Loans, if
delivery of such items is required pursuant to the terms of the related
Mortgage. The Special Servicer or Servicer, as applicable, shall promptly: (i)
review all such items as may be collected and (ii) prepare written reports
based on such reviews identifying the Debt Service Coverage Ratios for the
related Mortgage Loans. The Special Servicer shall deliver copies of the
collected items, and of the written reports prepared by the Special Servicer in
respect thereof, to the Servicer, via diskette or other electronic transmission
and by written report to follow, in each case within 20 days of its receipt or
preparation, as applicable, but in no event less than annually by June 1st of
each year. The Servicer shall deliver copies of the collected items, and of the
written reports prepared in respect thereof or received from the Special
Servicer, to the Trustee, the Paying Agent, the Rating Agencies, the
Underwriters, the Placement Agents and each Holder of a Class [F], Class [G]
and Class [H] Certificate, via diskette or other electronic transmission and by
written report to follow, in each case within 30 days of its receipt or
preparation, as applicable, but in no event less frequently than annually by
June 30th of each year. In addition, the Servicer shall, upon written request,
deliver to each Rating Agency copies of any quarterly operating statements
received by the Servicer.
SECTION 3.13. Annual Statement as to Compliance.
Each of the Servicer and the Special Servicer will deliver to the
Trustee, with a copy to the Paying Agent and Depositor, on or before
____________ of each year, beginning ____________, 1998, an Officer's
Certificate stating, as to each signer thereof, that (i) a review of the
activities of the Servicer or the Special Servicer, as the case may be, during
the preceding calendar year and of its performance under this Agreement has
been made under such officer's supervision, (ii) to the best of such officer's
knowledge, based on such review, the Servicer or the Special Servicer, as the
case may be, has maintained an effective internal control system relating to
its servicing of the Mortgage Loans serviced by it and has fulfilled in all
material respects its obligations under this Agreement throughout such year,
or, if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof and (iii) the Servicer or the Special Servicer, as the case may be, has
received no notice regarding qualification, or challenging the status, of
either the Lower-Tier REMIC or the Upper-Tier REMIC as a REMIC from the
Internal Revenue Service or any other governmental agency or body or, if it has
received any such notice, specifying the details thereof. A copy of such
Officer's Certificate may be obtained by Certificateholders upon written
request to the Paying Agent pursuant to Section 8.12 hereof.
SECTION 3.14. Reports by Independent Public Accountants.
Each of the Servicer and the Special Servicer at their own expense
shall cause a nationally recognized firm of independent certified public
accountants to furnish to the Servicer or the Special Servicer, as the case may
be, the Trustee, the Paying Agent and each Rating Agency, on or before
____________ of each year, commencing with ____________, 1998, a report stating
that (i) it has obtained from the Servicer or the Special Servicer, as the case
may be, a letter of representation regarding certain matters from the
management of the Servicer or the Special Servicer, as the case may be, which
includes an assertion that the Servicer or the
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Special Servicer, as the case may be, has maintained an effective internal
control system with respect to the servicing of the Mortgage Loans and has
complied with certain minimum mortgage loan servicing standards (to the extent
applicable to multifamily and mobile home community mortgage loans), identified
in the Uniform Single Attestation Program for Mortgage Bankers established by
the Mortgage Bankers Association of America, with respect to the Servicer's or
the Special Servicer's, as the case may be, servicing of multifamily and mobile
home community mortgage loans during the most recently completed calendar year
and (ii) on the basis of an examination conducted by such firm in accordance
with standards established by the American Institute of Certified Public
Accountants, such assertion is fairly stated in all material respects, subject
to such exceptions and other qualifications that, in the opinion of such firm,
such standards require it to report. In rendering its report such firm may
rely, as to the matters relating to the direct servicing of multifamily and
mobile home community mortgage loans by Sub-Servicers, upon comparable reports
of firms of independent certified public accountants rendered on the basis of
examinations conducted in accordance with the same standards (rendered within 1
year of such statement) with respect to those Sub-Servicers.
SECTION 3.15. Access to Certain Information.
Each of the Servicer and the Special Servicer shall provide or cause
to be provided to any Certificateholder or Certificate Owner that is, or is
affiliated with, a federally insured financial institution, the Trustee, the
Depositor, each Rating Agency, to the Servicer, or to the Special Servicer, as
applicable, and to the OTS, the FDIC, the Federal Reserve Board and the
supervisory agents and examiners of such boards and such corporations, and any
other federal or state banking or insurance regulatory authority that may
exercise authority over any Certificateholder, and each Holder of a Class [F],
Class [G] and Class [H] Certificate, access to any documentation regarding the
Mortgage Loans and the Trust Fund within its control which may be required by
this Agreement or by applicable law. Such access shall be afforded without
charge but only upon reasonable prior written request and during normal
business hours at the offices of the Servicer or the Special Servicer, as the
case may be, designated by it; provided, however, that the Class [F], Class [G]
and Class [H] Certificateholders shall be required to pay a reasonable and
customary fee for access to the aforementioned information, shall pay their own
photocopying costs and execute a reasonable and customary confidentiality
agreement with respect to such information. Nothing in this Section 3.15 shall
detract from the obligation of the Servicer and the Special Servicer to observe
any applicable law prohibiting disclosure of information with respect to the
Mortgagors, and the failure of the Servicer or the Special Servicer to provide
access as provided in this Section 3.15 as a result of such obligation shall
not constitute a breach of this Section 3.15. The Servicer and the Special
Servicer may each deny any of the foregoing persons access to confidential
information or any intellectual property which the Servicer or the Special
Servicer is restricted by license or contract from disclosing. Notwithstanding
the foregoing, the Servicer and the Special Servicer shall maintain separate
from such confidential information and intellectual property, all documentation
regarding the Mortgage Loans that is not confidential.
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SECTION 3.16. Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or certificate
of sale shall be issued to the Trustee on behalf of the Certificateholders. The
Special Servicer, on behalf of the Trust Fund, shall sell any REO Property
within two years after the Trust Fund acquires ownership of such REO Property
for purposes of Section 860G(a)(8) of the Code, unless the Special Servicer
either (i) is granted an extension of time (an "REO Extension") by the Internal
Revenue Service to sell such REO Property or (ii) obtains for the Trustee and
the Servicer an Opinion of Counsel (the cost of which shall be paid as a
Servicing Advance), addressed to the Trustee and the Servicer, to the effect
that the holding by the Trust Fund of such REO Property subsequent to the
second anniversary of such acquisition will not result in the imposition of
taxes on "prohibited transactions" of the Trust Fund or the Lower-Tier REMIC or
the Upper-Tier REMIC constituted thereby as defined in Section 860F of the Code
or cause either the Lower-Tier REMIC or the Upper-Tier REMIC to fail to qualify
as a REMIC at any time that any Uncertificated Lower-Tier Interests or
Certificates are outstanding. If the Special Servicer is granted the REO
Extension contemplated by clause (i) of the immediately preceding sentence or
obtains the Opinion of Counsel contemplated by clause (ii) of the immediately
preceding sentence, the Special Servicer shall sell such REO Property within
such period longer than two years as is permitted by such REO Extension or such
Opinion of Counsel, as the case may be. Any expense incurred by the Special
Servicer in connection with its being granted the REO Extension contemplated by
clause (i) of the second preceding sentence or its obtaining the Opinion of
Counsel contemplated by clause (ii) of the second preceding sentence, shall be
an expense of the Trust Fund payable out of the Certificate Account pursuant to
Section 3.05(a).
(b) The Special Servicer shall segregate and hold all funds collected
and received in connection with any REO Property separate and apart from its
own funds and general assets. If an REO Acquisition shall occur, the Special
Servicer shall establish and maintain one or more REO Accounts, held on behalf
of the Trustee in trust for the benefit of the Certificateholders, for the
retention of revenues and other proceeds derived from each REO Property. The
REO Account shall be an Eligible Account. The Special Servicer shall deposit,
or cause to be deposited, in the REO Account, within 1 Business Day after
receipt, all REO Revenues, Insurance and Condemnation Proceeds and Liquidation
Proceeds received in respect of an REO Property. Funds in the REO Account may
be invested in Permitted Investments in accordance with Section 3.06. The
Special Servicer shall give notice to the Trustee and the Servicer of the
location of the REO Account when first established and of the new location of
the REO Account prior to any change thereof.
(c) The Special Servicer shall withdraw from the REO Account funds
necessary for the proper operation, management, leasing, maintenance and
disposition of any REO Property, but only to the extent of amounts on deposit
in the REO Account relating to such REO Property. On each Determination Date,
the Special Servicer shall withdraw from the REO Account and deposit into the
Certificate Account the aggregate of all amounts received in respect of each
REO Property during the most recently ended Due Period, net of any withdrawals
made out of such amounts pursuant to the preceding sentence; provided, however,
that the Special Servicer may retain in such REO Account, in accordance with
the Servicing Standards, such portion of such balance as may be necessary to
maintain a reasonable reserve for repairs, replacements,
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leasing, management and tenant improvements and other related expenses for the
related REO Property. In addition, on each Determination Date, the Special
Servicer shall provide the Servicer with a written accounting of amounts
deposited in the Certificate Account on such date.
(d) The Special Servicer shall keep and maintain separate records, on
a property-by-property basis, for the purpose of accounting for all deposits
to, and withdrawals from, the REO Account pursuant to Section 3.16(b) or (c).
SECTION 3.17. Management of REO Property.
(a) If title to any REO Property is acquired, the Special Servicer
shall manage, conserve, protect, operate and lease such REO Property for the
benefit of the Certificateholders solely for the purpose of its timely
disposition and sale in a manner that does not cause such REO Property to fail
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8)
of the Code or result in the receipt by the Trust Fund of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code.
Subject to the foregoing, however, the Special Servicer shall have full power
and authority to do any and all things in connection therewith as are in the
best interests of and for the benefit of the Certificateholders (as determined
by the Special Servicer in its good faith and reasonable judgment) and,
consistent therewith, shall withdraw from the REO Account, to the extent of
amounts on deposit therein with respect to such REO Property, funds necessary
for the proper operation, management, leasing and maintenance of such REO
Property, including, without limitation:
(i) all insurance premiums due and payable in respect of such
REO Property;
(ii) all real estate taxes and assessments in respect of such
REO Property that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property, if
applicable; and
(iv) all costs and expenses necessary to maintain and lease
such REO Property.
To the extent that amounts on deposit in the REO Account in
respect of any REO Property are insufficient for the purposes set
forth in clauses (i) - (iv) above with respect to such REO Property,
the Servicer shall advance from its own funds such amount as is
necessary for such purposes unless (as evidenced by an Officer's
Certificate delivered to the Trustee, the Paying Agent and the
Depositor) if such advances would, if made, constitute Nonrecoverable
Servicing Advances. The Special Servicer shall give the Servicer, the
Trustee and the Fiscal Agent not less than five Business Days' notice,
together with all information reasonably requested by the Servicer
(upon which the Servicer may conclusively rely) to the extent in the
possession of the Special Servicer or readily obtainable by the
Special Servicer before the date on which the Servicer is requested to
make any Servicing Advance with respect to an REO Property; provided,
however, that only two Business Days' notice shall be required in
respect of Servicing
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Advances required to be made on an urgent or emergency basis (which
may include, without limitation, Servicing Advances required to make
tax or insurance payments).
(b) Without limiting the generality of the foregoing, the Special
Servicer shall not:
(i) permit the Trust Fund to enter into, renew or extend any
New Lease with respect to any REO Property, if the New Lease by its
terms will give rise to any income that does not constitute Rents from
Real Property;
(ii) permit any amount to be received or accrued under any
New Lease other than amounts that will constitute Rents from Real
Property;
(iii) authorize or permit any construction on any REO
Property, other than the completion of a building or other improvement
thereon, and then only if more than 10% of the construction of such
building or other improvement was completed before default on the
related Mortgage Loan became imminent, all within the meaning of
Section 856(e)(4)(B) of the Code; or
(iv) Directly Operate, or allow any other Person, other than
an Independent Contractor, to Directly Operate, any REO Property on
any date more than 90 days after its Acquisition Date;
unless, in any such case, the Special Servicer has obtained an Opinion of
Counsel (the cost of which shall be paid by the Servicer as a Servicing
Advance) to the effect that such action will not cause such REO Property to
fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code at any time that it is held by the Trust Fund, in which
case the Special Servicer may take such actions as are specified in such
Opinion of Counsel. Except as limited above in this Section 3.17 and by Section
3.17(c), the Special Servicer shall be permitted to cause the Trust Fund to
earn "net income from foreclosure property," subject to the standard of Section
3.01(a).
(c) The Special Servicer shall contract with any Independent
Contractor for the operation and management of any REO Property within 90 days
of the Acquisition Date thereof, provided that:
(i) the terms and conditions of any such contract may not be
inconsistent herewith and shall reflect an agreement reached at arm's
length;
(ii) the fees of such Independent Contractor (which shall be
an expense of the Trust Fund) shall be reasonable and customary in
light of the nature and locality of the Mortgaged Property;
(iii) any such contract shall require, or shall be
administered to require, that the Independent Contractor (A) pay all
costs and expenses incurred in connection with the operation and
management of such REO Property, including, without limitation, those
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listed in subsection (a) hereof, and (B) remit all related revenues
collected (net of its fees and such costs and expenses) to the Special
Servicer upon receipt;
(iv) none of the provisions of this Section 3.17(c) relating
to any such contract or to actions taken through any such Independent
Contractor shall be deemed to relieve the Special Servicer of any of
its duties and obligations hereunder with respect to the operation and
management of any such REO Property; and
(v) the Special Servicer shall be obligated with respect
thereto to the same extent as if it alone were performing all duties
and obligations in connection with the operation and management of
such REO Property.
The Special Servicer shall be entitled to enter into any agreement
with any Independent Contractor performing services for it related to its
duties and obligations hereunder for indemnification of the Special Servicer by
such Independent Contractor, and nothing in this Agreement shall be deemed to
limit or modify such indemnification.
SECTION 3.18. Sale of Defaulted Mortgage Loans and REO Properties.
(a) Each of the Servicer and the Special Servicer may sell or
purchase, or permit the sale or purchase of, a Mortgage Loan or REO Property
only on the terms and subject to the conditions set forth in this Section 3.18
or as otherwise expressly provided in or contemplated by Section 2.03(b) and
Section 9.01.
(b) In the event that any Mortgage Loan becomes a Defaulted Mortgage
Loan and the Special Servicer has determined in good faith that such Defaulted
Mortgage Loan will become subject to foreclosure proceedings, the Special
Servicer shall promptly so notify in writing the Trustee and the Servicer. The
Special Servicer or the Servicer may at its option purchase such Defaulted
Mortgage Loan from the Trust Fund, at a price equal to the Purchase Price. The
Purchase Price for any Defaulted Mortgage Loan purchased hereunder shall be
deposited into the Certificate Account, and the Trustee, upon receipt of an
Officer's Certificate from the Special Servicer to the effect that such deposit
has been made, shall release or cause to be released to the Special Servicer or
the Servicer, as the case may be, the related Mortgage File, and shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, as shall be necessary to vest in the Special Servicer or the Servicer
(in that order), as the case may be, ownership of such Defaulted Mortgage Loan.
(c) The Special Servicer may offer to sell any Defaulted Mortgage Loan
not otherwise purchased by the Special Servicer or the Servicer pursuant to
subsection (b) above, if and when the Special Servicer determines, consistent
with the Servicing Standards, that such a sale would produce a greater recovery
on a present value basis than would liquidation of the related Mortgaged
Property. Such offering shall be made in a commercially reasonable manner for a
period of not less than 20 days or more than 90 days. The Special Servicer
shall accept the highest cash bid received from any Person for such Defaulted
Mortgage Loan in an amount at least equal to the Purchase Price therefor;
provided, that in the absence of any such bid, the Special Servicer shall
accept the highest cash bid received from any Person that is determined
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by the Special Servicer to be a fair price for such Defaulted Mortgage Loan. In
the absence of any bid determined as provided below to be fair, the Special
Servicer shall proceed with respect to such Defaulted Mortgage Loan in
accordance with Section 3.09.
The Special Servicer shall use reasonable efforts to solicit bids for
each REO Property in such manner as will be reasonably likely to realize a fair
price within the time period provided for by Section 3.16(a). Such solicitation
shall be made in a commercially reasonable manner for a period of not less than
90 days or more than 270 days. The Special Servicer shall accept the highest
cash bid received from any Person for such REO Property in an amount at least
equal to the Purchase Price therefor; provided that in the absence of any such
bid, the Special Servicer shall accept the highest cash bid received from any
Person that is determined by the Special Servicer to be a fair price for such
REO Property. If the Special Servicer reasonably believes that it will be
unable to realize a fair price for any REO Property within the time constraints
imposed by Section 3.16(a), then the Special Servicer shall dispose of such REO
Property upon such terms and conditions as the Special Servicer shall deem
necessary and desirable to maximize the recovery thereon under the
circumstances and, in connection therewith, shall accept the highest
outstanding cash bid, regardless of from whom received. Notwithstanding the
foregoing, the Special Servicer shall not be obligated by the foregoing or
otherwise to accept the highest bid if the Special Servicer determines, in
accordance with the Servicing Standards, that rejection of such bid would be in
the best interests of the Certificateholders. In the event that the Special
Servicer determines with respect to any REO Property that the offers being made
with respect thereto are not in the best interests of the Certificateholders
and that the end of the two-year period referred to in Section 3.16(a) with
respect to such REO Property is approaching, the Special Servicer shall seek an
extension of such two-year period in the manner described in Section 3.16(a);
provided, however, that the Special Servicer shall use its best efforts,
consistent with the Servicing Standards, to sell any REO Property prior to two
years prior to the Rated Final Distribution Date.
The Special Servicer shall give the Trustee and the Servicer not less
than three Business Days' prior written notice of its intention to sell any
Defaulted Mortgage Loan or REO Property. No Interested Person shall be
obligated to submit a bid to purchase any Defaulted Mortgage Loan or REO
Property, and notwithstanding anything to the contrary herein, neither the
Trustee, in its individual capacity, nor any of its Affiliates may bid for or
purchase any Defaulted Mortgage Loan or any REO Property pursuant hereto.
(d) Whether any cash bid constitutes a fair price for any Defaulted
Mortgage Loan or REO Property, as the case may be, for purposes of Section
3.18(c), shall be determined by the Special Servicer, if the highest bidder is
a Person other than an Interested Person, and by the Trustee, if the highest
bidder is an Interested Person. In determining whether any bid received from an
Interested Person represents a fair price for any Defaulted Mortgage Loan or
any REO Property, the Trustee may conclusively rely on the opinion of an
Independent MAI-designated appraiser or other expert in real estate matters
retained by the Special Servicer at the expense of the Trust Fund. In
determining whether any bid constitutes a fair price for any Defaulted Mortgage
Loan or any REO Property, such appraiser or other expert in real estate matters
shall be instructed to take into account, as applicable, among other factors,
the period and amount of any delinquency on the affected Defaulted Mortgage
Loan, the occupancy level
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and physical condition of the Mortgaged Property or REO Property, the state of
the local economy and the obligation to dispose of any REO Property within the
time period specified in Section 3.16(a). The Purchase Price for any Defaulted
Mortgage Loan or REO Property shall in all cases be deemed a fair price.
(e) Subject to subsections (a) through (d) above, the Special Servicer
shall act on behalf of the Trustee in negotiating and taking any other action
necessary or appropriate in connection with the sale of any Defaulted Mortgage
Loan or REO Property, and the collection of all amounts payable in connection
therewith. Any sale of a Defaulted Mortgage Loan or any REO Property shall be
final and without recourse to the Trustee or the Trust Fund, and if such sale
is consummated in accordance with the terms of this Agreement, neither the
Special Servicer nor the Trustee shall have any liability to any
Certificateholder with respect to the purchase price therefor accepted by the
Special Servicer or the Trustee.
SECTION 3.19. [Intentionally Omitted]
SECTION 3.20. Modifications, Waivers, Amendments and Consents.
(a) Except as set forth in this Section 3.20(a) and Section 3.08, the
Servicer shall not agree to any modification, waiver or amendment of a Mortgage
Loan, and, except as provided in the following paragraph and in Section
3.20(d), no Mortgage Loan that is not a Specially Serviced Mortgage Loan may be
modified, waived or amended, provided, that the Special Servicer may agree to
extend the maturity date of a Mortgage Loan that is not a Specially Serviced
Mortgage Loan, provided, further, that no such extension entered into pursuant
to this Section 3.20(a) shall be for a period of more than twelve months from
the original maturity date of such Mortgage Loan or shall extend the maturity
date beyond the earlier of (i) two years prior to the Rated Final Distribution
Date and (ii) in the case of a Mortgage Loan secured by a leasehold estate, the
date ten years prior to the expiration of such leasehold estate. If such
extension would extend the Maturity Date of a Mortgage Loan for more than
twelve months from and after the original maturity date of such Mortgage Loan,
the Special Servicer must provide the Trustee with an opinion of counsel that
such extension would not constitute a "significant modification" of the
Mortgage Loan within the meaning of Treasury Regulations Section 1.860G-2(b).
Any substitution of collateral shall be treated hereunder as a modification or
amendment of the applicable Mortgage Loan.
Notwithstanding the foregoing, the Servicer may modify or amend the
terms of any Mortgage Loan without the consent of the Special Servicer in order
to (i) cure any ambiguity therein or (ii) correct or supplement any provisions
therein which may be inconsistent with any other provisions therein or correct
any error, provided that such modification or amendment would not be a
"significant modification" of the Mortgage Loan within the meaning of Treasury
Regulations Section 1.860G-2(b), and provided further that the proposed
modification or amendment will not cause (x) either the Upper-Tier REMIC or the
Lower-Tier REMIC to fail to qualify as a REMIC for purposes of the Code or (y)
either the Upper-Tier REMIC or the Lower-Tier REMIC to be subject to any tax
under the REMIC Provisions.
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Notwithstanding the foregoing, the Special Servicer shall not permit
the substitution of any Mortgaged Property (or any portion thereof) pursuant to
the terms of the related Mortgage Loan documents unless it has received an
Opinion of Counsel to the effect that (i) such substitution will not cause the
related Mortgage Loan to fail to qualify as a "qualified mortgage" for REMIC
purposes, (ii) such substitution will not affect the status as a REMIC of
either the Upper-Tier REMIC or the Lower-Tier REMIC, and (iii) such
substitution will not subject the Trust Fund, the Upper-Tier REMIC or the
Lower-Tier REMIC to any tax.
(b) If, but only if, the Special Servicer determines that a
modification, waiver or amendment (including, without limitation, the
forgiveness or deferral of interest or principal or the substitution of
collateral pursuant to the terms of the Mortgage Loan or otherwise, the release
of collateral or the pledge of additional collateral) of the terms of a
Specially Serviced Mortgage Loan with respect to which a payment default or
other material default has occurred or a payment default is, in the Special
Servicer's judgment, reasonably foreseeable (as evidenced by an Officer's
Certificate of the Special Servicer), is reasonably likely to produce a greater
recovery on a present value basis (the relevant discounting to be performed at
the related Mortgage Rate) than liquidation of such Specially Serviced Mortgage
Loan, then the Special Servicer may, but is not required to, with the approval
or deemed approval of the Extension Adviser, in the case of an extension of the
maturity of a Specially Serviced Mortgage Loan beyond the third anniversary of
such Mortgage Loan's original maturity date, agree to a modification, waiver or
amendment of such Specially Serviced Mortgage Loan, subject to the provisions
of this Section 3.20(b) and Section 3.20(c).
The Special Servicer shall use its best efforts to the extent possible
to cause each Specially Serviced Mortgage Loan to fully amortize prior to the
Rated Final Distribution Date and shall not agree to a modification, waiver or
amendment of any term of any Specially Serviced Mortgage Loan if such
modification, waiver or amendment would:
(i) extend the maturity date of any such Specially Serviced
Mortgage Loan to a date occurring later than the earlier of (a) two
years prior to the Rated Final Distribution Date and (b) if such
Specially Serviced Mortgage Loan is secured by a leasehold estate, the
date occurring ten years prior to the expiration of such leasehold; or
(ii) reduce the related Net Mortgage Rate on any such
Specially Serviced Mortgage Loan to less than the lesser of (a) the
original Net Mortgage Rate and (b) ___% per annum; or
(iii) provide for the deferral of interest unless (a)
interest accrues thereon, generally, at the related Mortgage Rate and
(b) the aggregate amount of such deferred interest does not exceed 10%
of the unpaid principal balance of the Specially Serviced Mortgage
Loan.
(c) Any provision of this Section 3.20 to the contrary
notwithstanding, no fee described in this paragraph shall be collected by any
Servicer or Special Servicer from a Mortgagor (or on behalf of the Mortgagor)
in conjunction with any consent or any modification,
82
waiver or amendment of a Mortgage Loan (unless the amount thereof is specified
in the related Mortgage Note) if the collection of such fee would cause such
consent, modification, waiver or amendment to be a "significant modification"
of the Mortgage Note within the meaning of Treasury Regulations Section
1.860G-2(b).
(d) Notwithstanding anything to the contrary in this Agreement, the
Special Servicer may agree to any waiver, modification or amendment of a
Mortgage Loan that is not in default or as to which default is not reasonably
foreseeable only to the extent that it would not be a "significant
modification" of the Mortgage Loan within the meaning of Treasury Regulations
Section 1.860G-2(b), provided that the proposed modification, amendment or
waiver will not cause (x) either the Lower-Tier REMIC or the Upper-Tier REMIC
to fail to qualify as a REMIC for purposes of the Code or (y) either the
Lower-Tier REMIC or the Upper-Tier REMIC to be subject to any tax under the
REMIC Provisions. With respect to all modifications, amendments and waivers
entered into by the Special Servicer pursuant to this Section 3.20(d), the
Special Servicer shall provide the Trustee with an Opinion of Counsel (at the
expense of the related Mortgagor or such other Person requesting such
modification or, if such expense cannot be collected from the related Mortgagor
or such other Person, to be paid by the Servicer as a Servicing Advance) to the
effect that the contemplated, waiver, modification or amendment (i) will not be
a "significant modification" of the Mortgage Loan within the meaning of
Treasury Regulations Section 1.860G-2(b) and (ii) will not cause either clause
(x) or (y) of this Section 3.20(d) to occur. Notwithstanding the foregoing, the
Special Servicer may not waive the payment of any Prepayment Premiums or Yield
Maintenance Charge with respect to any Mortgage Loan that is not a Specially
Serviced Mortgage Loan.
(e) In the event of a modification which creates Mortgage Deferred
Interest, such Mortgage Deferred Interest will be allocated to reduce the
Distributable Certificate Interest of the Class or Classes of Certificates
pursuant to Section 4.06.
(f) Subject to Section 3.20(c), the Servicer and the Special Servicer
each may, as a condition to its granting any request by a Mortgagor for
consent, modification, waiver or indulgence or any other matter or thing, the
granting of which is within the Servicer's or the Special Servicer's, as the
case may be, discretion pursuant to the terms of the instruments evidencing or
securing the related Mortgage Loan and is permitted by the terms of this
Agreement, require that such Mortgagor pay to the Servicer or the Special
Servicer, as the case may be, as additional servicing compensation, a
reasonable or customary fee, for the additional services performed in
connection with such request.
(g) All modifications, waivers and amendments of the Mortgage Loans
entered into pursuant to this Section 3.20 shall be in writing, signed by the
Servicer or the Special Servicer, as the case may be, and the related Mortgagor
(and by any guarantor of the related Mortgage Loan, if such guarantor's
signature is required by the Special Servicer in accordance with the Servicing
Standards).
(h) Each of the Servicer and the Special Servicer shall notify the
Rating Agencies, the Trustee, the Paying Agent and each other in writing of any
modification, waiver or amendment of any term of any Mortgage Loan and the date
thereof, and shall deliver to the
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Trustee or the related Custodian for deposit in the related Mortgage File, an
original counterpart of the agreement relating to such modification, waiver or
amendment, promptly (and in any event within 10 Business Days) following the
execution thereof. In addition, the Special Servicer shall promptly send a copy
of such a modification, waiver or amendment to the Servicer. Within 15 days of
the Servicer's delivery of the aforesaid modification, waiver or amendment to
the Trustee or its receipt from the Special Servicer, as applicable, the
Servicer shall forward a copy thereof to each Holder of a Class [F], Class [G]
and Class [H] Certificate.
SECTION 3.21. Transfer of Servicing Between Servicer and Special Servicer;
Record Keeping; Asset Status Report.
(a) Upon determining that a Servicing Transfer Event has occurred with
respect to any Mortgage Loan, the Servicer shall immediately give notice
thereof, and shall deliver the related Mortgage File and Credit File to the
Special Servicer and shall use its best efforts to provide the Special Servicer
with all information, documents and records (including records stored
electronically on computer tapes, magnetic discs and the like) relating to the
Mortgage Loan and reasonably requested by the Special Servicer to enable it to
assume its functions hereunder with respect thereto. The Servicer shall use its
best efforts to comply with the preceding sentence within 5 Business Days of
the occurrence of each related Servicing Transfer Event and in any event shall
continue to act as Servicer and administrator of such Mortgage Loan until the
Special Servicer has commenced the servicing of such Mortgage Loan. The
Servicer shall deliver to the Trustee, the Paying Agent, the Underwriters, the
Placement Agents and to each Holder of a Class [F], Class [G] and Class [H]
Certificate a copy of the notice of such Servicing Transfer Event provided by
the Servicer to the Special Servicer pursuant to this Section.
Upon determining that a Specially Serviced Mortgage Loan (other than
an REO Loan) has become current and has remained current for three consecutive
Monthly Payments (provided no additional Servicing Transfer Event is
foreseeable in the reasonable judgment of the Special Servicer), and that no
other Servicing Transfer Event is continuing with respect thereto, the Special
Servicer shall immediately give notice thereof, and shall return the related
Mortgage File and Credit File to the Servicer and upon giving such notice, and
returning such Mortgage File and Credit File to the Servicer, the Special
Servicer's obligation to service such Corrected Mortgage Loan shall terminate
and the obligations of the Servicer to service and administer such Mortgage
Loan shall re-commence.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer will provide to the Trustee originals of documents included within the
definition of "Mortgage File" for inclusion in the related Mortgage File (with
a copy of each such original to the Servicer), and provide the Servicer with
copies of any additional related Mortgage Loan information including
correspondence with the related Mortgagor.
(c) On or before each Determination Date, the Special Servicer shall
deliver to the Servicer and Paying Agent a written statement (upon which the
Servicer and the Paying Agent may conclusively rely) describing, on a
loan-by-loan and property-by-property basis, (1) the information described in
clause (vii) of Section 4.02(a) with respect to each Specially Serviced
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Mortgage Loan and the information described in clause (viii) of Section 4.02(a)
with respect to each REO Property, (2) the amount of all payments, Insurance
and Condemnation Proceeds and Liquidation Proceeds received with respect to
each Specially Serviced Mortgage Loan during the related Due Period, and the
amount of all REO Revenues, Insurance and Condemnation Proceeds and Liquidation
Proceeds received with respect to each REO Property during the related Due
Period, (3) the amount, purpose and date of all Servicing Advances made by the
Servicer with respect to each Specially Serviced Mortgage Loan and REO Property
during the related Due Period, (4) the information described in clauses (v),
(vii)(c), (vii)(d), (viii), (xi), (xvi) and (xvii) of Section 4.02(a) and (5)
such additional information relating to the Specially Serviced Mortgage Loans
and REO Properties as the Servicer reasonably requests to enable it to perform
its responsibilities under this Agreement which is in the Special Servicer's
possession or is reasonably obtainable by the Special Servicer.
(d) Notwithstanding the provisions of the preceding clause (c), the
Servicer shall maintain ongoing payment records with respect to each of the
Specially Serviced Mortgage Loans and REO Properties and shall provide the
Special Servicer with any information in its possession required by the Special
Servicer to perform its duties under this Agreement.
(e) No later than 30 days after a Servicing Transfer Event for a
Mortgage Loan, the Special Servicer shall deliver to each Rating Agency and the
Directing Certificateholder a report (the "Asset Status Report") with respect
to such Mortgage Loan and the related Mortgaged Property. Such Asset Status
Report shall set forth the following information to the extent reasonably
determinable:
(i) summary of the status of such Specially Serviced Mortgage
Loan and any negotiations with the related Mortgagor;
(ii) a discussion of the legal and environmental
considerations reasonably known to the Special Servicer, consistent
with the Servicing Standards, that are applicable to the exercise of
remedies as aforesaid and to the enforcement of any related guaranties
or other collateral for the related Mortgage Loan and whether outside
legal counsel has been retained;
(iii) the most current rent roll and income or operating
statement available for the related Mortgaged Property;
(iv) the Special Servicer's recommendations on how such
Specially Serviced Mortgage Loan might be returned to performing
status and returned to the Servicer for regular servicing or otherwise
realized upon;
(v) the Appraised Value of the Mortgaged Property together
with the assumptions used in the calculation thereof; and
(vi) such other information as the Special Servicer deems
relevant in light of the Servicing Standards.
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If within 10 Business Days of receiving an Asset Status Report, the
Directing Certificateholder does not disapprove such Asset Status Report in
writing, the Special Servicer shall implement the recommended action as
outlined in such Asset Status Report; provided, however, that the Special
Servicer may not take any action that is contrary to applicable law or the
terms of the applicable Mortgage Loan documents. If the Directing
Certificateholder disapproves such Asset Status Report, the Special Servicer
will revise such Asset Status Report and deliver to the Directing
Certificateholder, the Rating Agencies and the Servicer a new Asset Status
Report as soon as practicable, but in no event later than 30 days after such
disapproval. The Special Servicer shall revise such Asset Status Report as
described above in this Section 3.21(e) until the Directing Certificateholder
shall fail to disapprove such revised Asset Status Report in writing within 10
Business Days of receiving such revised Asset Status Report or until the
Special Servicer makes one of the determinations described below. The Special
Servicer may, from time to time, modify any Asset Status Report it has
previously delivered and implement such report, provided such report shall have
been prepared, reviewed and not rejected pursuant to the terms of this Section.
Notwithstanding the foregoing, the Special Servicer (i) may, following the
occurrence of an extraordinary event with respect to the related Mortgaged
Property, take any action set forth in such Asset Status Report before the
expiration of a 10 Business Day period if the Special Servicer has reasonably
determined that failure to take such action would materially and adversely
affect the interests of the Certificateholders and it has made a reasonable
effort to contact the Directing Certificateholder and (ii) in any case, shall
determine whether such affirmative disapproval is not in the best interest of
all the Certificateholders pursuant to the Servicing Standards. Upon making
such determination, the Special Servicer shall notify the Paying Agent and the
Trustee of such rejection and deliver to the Paying Agent and the Trustee a
proposed notice to Certificateholders which shall include a copy of the Asset
Status Report, and the Paying Agent shall send such notice to all
Certificateholders. If the majority of such Certificateholders, as determined
by Voting Rights, fail, within 5 days of the Paying Agent's sending such
notice, to reject such Asset Status Report, the Special Servicer shall
implement the same. If the Asset Status Report is rejected by the
Certificateholders, the Special Servicer shall revise such Asset Status Report
as described above in this Section 3.21(e). The Paying Agent shall be entitled
to reimbursement from the Trust Fund for the reasonable expenses of providing
such notices.
The Special Servicer shall have the authority to meet with the
Mortgagor for any Specially Serviced Mortgage Loan and take such actions
consistent with the Servicing Standards and the related Asset Status Report.
The Special Servicer shall not take any action inconsistent with the related
Asset Status Report, unless such action would be required in order to act in
accordance with the Servicing Standards.
No direction of the Directing Certificateholder shall (a) require or
cause the Special Servicer to violate the terms of a Specially Serviced
Mortgage Loan, applicable law or any provision of this Agreement, including the
Special Servicer's obligation to act in accordance with the Servicing Standards
and to maintain the REMIC status of each of the Lower-Tier REMIC and the
Upper-Tier REMIC, or (b) result in the imposition of a "prohibited transaction"
or "prohibited contribution" tax under the REMIC Provisions, or (c) expose the
Servicer, the Special Servicer, the Depositor, the Mortgage Loan Seller, the
Trust Fund, the Trustee, the Fiscal Agent or their officers, directors,
employees or agents to any claim, suit or liability or
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(d) materially expand the scope of the Special Servicer's or the Servicer's
responsibilities under this Agreement.
(f) Upon receiving notice of (i) the filing of a case under any
present or future federal or state bankruptcy, insolvency or similar law or the
commencing of any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings with respect to a Mortgage Loan or the
related Mortgagor, (ii) the existence of a material non-payment default or
(iii) the request by a Mortgagor for the amendment or modification of a
Mortgage Loan other than an amendment or modification provided for in the
second paragraph in Section 3.20(a), the Servicer shall immediately give notice
thereof, and shall deliver copies of the related Mortgage File and Credit File
to the Special Servicer and shall use its reasonable best efforts to provide
the Special Servicer with all information relating to the Mortgage Loan and
reasonably requested by the Special Servicer to enable it to negotiate with the
related Mortgagor and prepare for any such proceedings. The Servicer shall use
its reasonable best efforts to comply with the preceding sentence within 5
Business Days of the occurrence of each such event, and upon receiving such
documents and information, the Special Servicer shall use its reasonable best
efforts to cause the related Mortgagor to cure any default and/or remedy any
such event, work out or modify the Mortgage Loan consistent with the terms of
this Agreement, and/or prepare for such proceedings. Notwithstanding the
foregoing, the occurrence of any of the above-referenced events shall not in
and of itself be considered a Servicing Transfer Event and, unless a Servicing
Transfer Event has occurred with respect to a related Mortgage Loan, the
Servicer shall continue to act as Servicer and administrator of such Mortgage
Loan and no fees shall be payable to the Special Servicer with respect to such
Mortgage Loan other than any related modification, assumption or extension fees
provided for herein.
SECTION 3.22. Sub-Servicing Agreements.
(a) The Servicer may enter into Sub-Servicing Agreements to provide
for the performance by third parties of any or all of its respective
obligations under Articles III and IV hereof; provided that the Sub-Servicing
Agreement: (i) is consistent with this Agreement in all material respects and
requires the Sub-Servicer to comply with all of the applicable conditions of
this Agreement; (ii) provides that if the Servicer shall for any reason no
longer act in such capacity hereunder (including, without limitation, by reason
of an Event of Default), the Trustee or its designee shall thereupon assume all
of the rights and, except to the extent they arose prior to the date of
assumption, obligations of the Servicer under such agreement, or,
alternatively, may act in accordance with Section 7.02 hereof under the
circumstances described therein; (iii) provides that the Trustee for the
benefit of the Certificateholders shall be a third party beneficiary under such
Sub-Servicing Agreement, but that (except to the extent the Trustee or its
designee assumes the obligations of the Servicer thereunder as contemplated by
the immediately preceding clause (ii)) none of the Trust Fund, the Trustee, any
successor Servicer or any Certificateholder shall have any duties under such
Sub-Servicing Agreement or any liabilities arising therefrom; (iv) permits any
purchaser of a Mortgage Loan pursuant to this Agreement to terminate such
Sub-Servicing Agreement with respect to such purchased Mortgage Loan at its
option and without penalty and (v) does not permit the Sub-Servicer any direct
rights of indemnification that may be satisfied out of assets of the Trust
Fund. Any successor Servicer hereunder shall, upon becoming successor Servicer,
be assigned and shall assume any
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Sub-Servicing Agreements from the predecessor Servicer. In addition, each
Sub-Servicing Agreement entered into by the Servicer may provide that the
obligations of the Sub-Servicer thereunder shall terminate with respect to any
Mortgage Loan serviced thereunder at the time such Mortgage Loan becomes a
Specially Serviced Mortgage Loan; provided, however, that the Sub-Servicing
Agreement may provide that the Sub-Servicer will continue to make all Advances
and calculations and prepare all reports required under the Sub-Servicing
Agreement with respect to Specially Serviced Mortgage Loans as if no Servicing
Transfer Event had occurred and with respect to REO Properties (and the related
REO Loans) as if no REO Acquisition had occurred and to render such incidental
services with respect to such Specially Serviced Mortgage Loans and REO
Properties as are specifically provided for in such Sub-Servicing Agreement.
The Servicer shall deliver to the Trustee and the Paying Agent copies of all
Sub-Servicing Agreements, and any amendments thereto and modifications thereof,
entered into by it promptly upon its execution and delivery of such documents.
References in this Agreement to actions taken or to be taken by the Servicer
include actions taken or to be taken by a Sub-Servicer on behalf of the
Servicer; and, in connection therewith, all amounts advanced by any
Sub-Servicer to satisfy the obligations of the Servicer hereunder to make
Advances shall be deemed to have been advanced by the Servicer out of its own
funds and, accordingly, such Advances shall be recoverable by such Sub-Servicer
in the same manner and out of the same funds as if such Sub-Servicer were the
Servicer, and, for so long as they are outstanding, such Advances shall accrue
interest in accordance with Section 3.03(d), such interest to be allocable
between the Servicer and such Sub-Servicer pursuant to the terms of the
Sub-Servicing Agreement. For purposes of this Agreement, the Servicer shall be
deemed to have received any payment when a Sub-Servicer retained by it receives
such payment. The Servicer shall notify the Special Servicer, the Trustee and
the Depositor in writing promptly of the appointment by it of any Sub-Servicer.
Except as otherwise provided herein, the Special Servicer may not enter into
Sub-Servicing Agreements and may not assign any of its servicing obligations
hereunder.
(b) Each Sub-Servicer shall be authorized to transact business in the
state or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law.
(c) As part of its servicing activities hereunder, the Servicer, for
the benefit of the Trustee and the Certificateholders, shall (at no expense to
the Trustee, the Certificateholders or the Trust Fund) monitor the performance
and enforce the obligations of each Sub-Servicer under the related
Sub-Servicing Agreement. Such enforcement, including, without limitation, the
legal prosecution of claims, termination of Sub-Servicing Agreements in
accordance with their respective terms and the pursuit of other appropriate
remedies, shall be in such form and carried out to such an extent and at such
time as the Servicer would require were it the owner of the Mortgage Loans. The
Servicer shall have the right to remove a Sub-Servicer retained by it in
accordance with the terms of the related Sub-Servicing Agreement.
(d) In the event the Trustee or its designee becomes successor
Servicer and assumes the rights and obligations of the Servicer under any
Sub-Servicing Agreement, the Servicer, at its expense, shall deliver to the
assuming party all documents and records relating to such Sub-Servicing
Agreement and the Mortgage Loans then being serviced thereunder and an
accounting of amounts collected and held on behalf of it thereunder, and
otherwise use
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reasonable efforts to effect the orderly and efficient transfer of the
Sub-Servicing Agreement to the assuming party.
(e) Notwithstanding the provisions of any Sub-Servicing Agreement, the
Servicer represents and warrants that it shall remain obligated and liable to
the Trustee and the Certificateholders for the performance of its obligations
and duties under this Agreement in accordance with the provisions hereof to the
same extent and under the same terms and conditions as if it alone were
servicing and administering the Mortgage Loans for which it is responsible, and
the Servicer shall pay the fees of any Sub-Servicer thereunder from its own
funds. In no event shall the Trust Fund bear any termination fee required to be
paid to any Sub-Servicer as a result of such Sub-Servicer's termination under
any Sub-Servicing Agreement.
(f) The Trustee shall furnish to any Sub-Servicer any powers of
attorney and other documents necessary or appropriate to enable such
Sub-Servicer to carry out its servicing and administrative duties under any
Sub-Servicing Agreement; provided, however, that the Trustee shall not be held
liable for any negligence, and shall be indemnified by the Sub-Servicer, with
respect to, or misuse of, any such power of attorney by a Sub-Servicer.
(g) Each Sub-Servicing Agreement shall provide that, in the event the
Trustee or any other Person becomes successor Servicer, the Trustee or such
successor Servicer shall have the right to terminate such Sub-Servicing
Agreement without a fee. Notwithstanding the foregoing, the Trustee and any
successor Servicer shall assume the Sub-Servicing Agreement with ____________
dated as of the date hereof, provided that ____________ maintains an
"acceptable" servicer rating from ____________, and an approved Servicer
ranking of at least average from ____________.
(h) Promptly (but in no event later than 5 Business Days) after the
execution of any Sub-Servicing Agreement, the Servicer shall forward a copy of
such Sub-Servicing Agreement to the Special Servicer. The Special Servicer
shall comply with the terms of each such Sub-Servicing Agreement to the extent
the terms thereof are not inconsistent with the terms of this Agreement and the
Special Servicer's obligations hereunder. With respect to Mortgage Loans
subject to a Sub-Servicing Agreement, the Special Servicer shall, among other
things, remit amounts, deliver reports and information, and afford access to
facilities and information to the related Sub-Servicer that would be required
to be remitted, delivered or afforded, as the case may be, to the Servicer
pursuant to the terms hereof within a sufficient period of time to allow the
Sub-Servicer to fulfill its obligations under such Sub-Servicing Agreement and
in no event later than 1 Business Day prior to the applicable Determination
Date (or such other date as specified herein).
SECTION 3.23. Representations and Warranties of the Servicer.
(a) The Servicer hereby represents and warrants to the Trustee, for
its own benefit and the benefit of the Certificateholders, and to the
Depositor, the Special Servicer and the Fiscal Agent, as of the Closing Date,
that:
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(i) The Servicer is a banking corporation duly organized,
validly existing and in good standing under the laws of the State of
_______________, and the Servicer is in compliance with the laws of
each State in which any Mortgaged Property is located to the extent
necessary to perform its obligations under this Agreement;
(ii) The execution and delivery of this Agreement by the
Servicer, and the performance and compliance with the terms of this
Agreement by the Servicer, will not violate the Servicer's charter and
by-laws or constitute a default (or an event which, with notice or
lapse of time, or both, would constitute a default) under, or result
in the breach of, any material agreement or other instrument to which
it is a party or which is applicable to it or any of its assets, or
result in the violation of any law, rule, regulation, order, judgment
or decree to which the Servicer or its property is subject;
(iii) This Agreement, assuming due authorization, execution
and delivery by the Trustee and the Depositor, constitutes a valid,
legal and binding obligation of the Servicer, enforceable against the
Servicer in accordance with the terms hereof, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights generally, and general
principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law;
(iv) The Servicer is not in default with respect to any law,
any order or decree of any court, or any order, regulation or demand
of any federal, state, municipal or governmental agency, which default
might have consequences that would materially and adversely affect the
condition (financial or other) or operations of the Servicer or its
properties or might have consequences that would materially and
adversely affect its ability to perform its duties and obligations
hereunder;
(v) No litigation is pending or, to the best of the
Servicer's knowledge, threatened against the Servicer which would
prohibit the Servicer from entering into this Agreement or, in the
Servicer's good faith and reasonable judgment, is likely to materially
and adversely affect either the ability of the Servicer to perform its
obligations under this Agreement or the financial condition of the
Servicer;
(vi) The Servicer will examine each Sub-Servicing Agreement
and will be familiar with the terms thereof. Any Sub-Servicing
Agreements will comply with the provisions of Section 3.22;
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Servicer, or compliance by the
Servicer with, this Agreement or the consummation of the transactions
contemplated by this Agreement, except for any consent, approval,
authorization or order which has not been obtained or cannot be
obtained prior to the actual performance by the Servicer of its
obligations under this Agreement, and which, if not obtained would not
have a materially adverse effect on the ability of the Servicer to
perform its obligations hereunder; and
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(viii) The Servicer has full power and authority to enter
into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(b) The representations and warranties set forth in paragraph (a)
above shall survive the execution and delivery of the Agreement. The Servicer
shall indemnify the Trustee, the Fiscal Agent and the Trust Fund and hold each
of them harmless against any losses, damages, penalties, fines, forfeitures,
and legal fees and related costs, judgments, and other costs and expenses
resulting from any claim, demand, defense or assertion arising from, or
resulting from a material breach of the Servicer's representations and
warranties contained in paragraph (a) above. Such indemnification shall survive
any termination or resignation of the Servicer, and any termination of the
Agreement.
SECTION 3.24. Representations and Warranties of the Special Servicer.
(a) The Special Servicer hereby represents and warrants to the
Trustee, for its own benefit and the benefit of the Certificateholders, and to
the Depositor, the Servicer and the Fiscal Agent, as of the Closing Date, that:
(i) The Special Servicer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
____________, and the Special Servicer is in compliance with the laws
of each State in which any Mortgaged Property is located to the extent
necessary to perform its obligations under this Agreement;
(ii) The execution and delivery of this Agreement by the
Special Servicer, and the performance and compliance with the terms of
this Agreement by the Special Servicer, will not violate the Special
Servicer's charter and by-laws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a
default) under, or result in the breach of, any material agreement or
other instrument to which it is a party or which is applicable to it
or any of its assets, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Special Servicer or
its property is subject;
(iii) The Special Servicer has the full power and authority
to enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and performance
of this Agreement, and has duly executed and delivered this Agreement;
(iv) This Agreement, assuming due authorization, execution
and delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Special Servicer, enforceable
against the Special Servicer in accordance with the terms hereof,
subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally and (B) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at
law;
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(v) The Special Servicer is not in violation of, and its
execution and delivery of this Agreement and its performance and
compliance with the terms of this Agreement will not constitute a
violation of, any law, any order or decree of any court or arbiter, or
any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Special
Servicer's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the Special Servicer to
perform its obligations under this Agreement or the financial
condition of the Special Servicer;
(vi) No litigation is pending or, to the best of the Special
Servicer's knowledge, threatened against the Special Servicer which
would prohibit the Special Servicer from entering into this Agreement
or, in the Special Servicer's good faith and reasonable judgment, is
likely to materially and adversely affect either the ability of the
Special Servicer to perform its obligations under this Agreement or
the financial condition of the Special Servicer;
(vii) Each officer, director or employee of the Special
Servicer that has or, following the occurrence of a Servicing Transfer
Event, would have responsibilities concerning the servicing and
administration of Mortgage Loans is covered by errors and omissions
insurance in the amounts and with the coverage required by Section
3.07(c). Neither the Special Servicer nor any of its officers,
directors or employees that is or, following the occurrence of a
Servicing Transfer Event, would be involved in the servicing or
administration of Mortgage Loans has been refused such coverage or
insurance; and
(viii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Special Servicer, or compliance by the
Special Servicer with, this Agreement or the consummation of the
transactions contemplated by this Agreement, except for any consent,
approval, authorization or order which has not been obtained or cannot
be obtained prior to the actual performance by the Special Servicer of
its obligations under this Agreement, and which, if not obtained would
not have a materially adverse effect on the ability of the Special
Servicer to perform its obligations hereunder.
(b) The representations and warranties set forth in paragraph (a)
above shall survive the execution and delivery of the Agreement. The Special
Servicer shall indemnify the Trustee, the Fiscal Agent and the Trust Fund and
hold them harmless against any losses, damages, penalties, fines, forfeitures,
legal fees and related costs, judgments and other costs and expenses resulting
from any claim, demand, defense or assertion based on or grounded upon, or
resulting from a material breach of the Special Servicer's representations and
warranties contained in paragraph (a) above. Such indemnification shall survive
any termination or resignation of the Special Servicer, and any termination of
the Agreement.
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SECTION 3.25. Duties of the Extension Adviser.
(a) The Special Servicer may not extend the maturity of any Specially
Serviced Mortgage Loan beyond the third anniversary of such Mortgage Loan's
original maturity date, unless the Extension Adviser elected pursuant to
Section 3.26 shall have approved such extension in writing within 10 days after
receiving from the Special Servicer the information, analysis and certification
required by Section 3.25(b). If a written objection to such extension from the
Extension Adviser has not been received by the Special Servicer within said
10-day period, then the Extension Adviser's approval shall be deemed to have
been given.
(b) The Special Servicer shall, with respect to any proposed extension
of a Specially Serviced Mortgage Loan beyond the third anniversary of such
Mortgage Loan's original maturity date, prepare and deliver to the Extension
Adviser, a summary of such proposed extension and an analysis summarizing the
basis of its conclusion that such extension is reasonably likely to produce a
greater recovery on a present value basis (the relevant discounting to be
performed at the related Net Mortgage Rate) than liquidation of such Mortgage
Loan. Such analysis shall specify the basis on which the Special Servicer has
made such determination, including the status of any existing material default
or the grounds for concluding that a payment default is imminent. The Special
Servicer shall promptly provide the Extension Adviser with such information as
is reasonably requested by the Extension Adviser (including, without
limitation, operating statements, rents rolls, appraisals, environmental
reports, inspection reports and financial statements of the applicable
Mortgagor) in connection with any proposed extension that is in the Special
Servicer's possession or is reasonably obtainable by the Special Servicer. The
Extension Adviser shall be entitled to rely on the information provided by the
Special Servicer without any independent investigation or verification on the
part of the Extension Adviser. In addition, the Special Servicer, in connection
with each request for extension, shall provide to the Extension Adviser an
Officer's Certificate confirming that all conditions precedent to the granting
of any such extension set forth in this Agreement (other than the approval of
the Extension Adviser) have been satisfied.
(c) No direction of the Extension Adviser shall (i) require or cause
the Special Servicer to violate the terms of a Specially Serviced Mortgage
Loan, applicable law or any provision of this Agreement, including the Special
Servicer's obligation to act in accordance with the Servicing Standards and to
maintain the REMIC status of the Lower-Tier REMIC and the Upper-Tier REMIC, or
(ii) result in the imposition of a "prohibited transaction" or "prohibited
contribution" tax under the REMIC Provisions, or (iii) expose the Servicer, the
Special Servicer, the Depositor, the Mortgage Loan Seller, the Trust Fund, the
Trustee, the Fiscal Agent or their officers, directors, employees or agents to
any claim, suit or liability or (iv) materially expand the scope of the Special
Servicer's or the Servicer's responsibilities under this Agreement.
SECTION 3.26. Extension Adviser; Elections.
(a) The Class [A], Class [B], Class [C], Class [D] and Class [E]
Certificateholders will be entitled to elect, and shall be deemed to have
elected, the Trustee or a designee of the Trustee as their representative (the
"Extension Adviser") as provided in this Section 3.26. The Trustee (or any
other Person duly elected as Extension Adviser) may resign as Extension
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Adviser at any time for any reason or no reason upon not less than five
Business Days' written notice to the Depositor, the Trustee, the Special
Servicer, the Servicer and each Class [A], Class [B], Class [C], Class [D] and
Class [E] Certificateholder. Promptly after the Closing Date (but in no event
later than 30 days after the Closing Date), the Trustee shall hold an election
to determine the Extension Adviser. In addition, upon (i) the receipt by the
Trustee of written requests for an election of an Extension Adviser from such
Certificateholders representing more than 50% of the Voting Rights of all the
Class [A], Class [B], Class [C], Class [D] and Class [E] Certificates or (ii)
the resignation or removal of the Person acting as Extension Adviser, an
election of a successor Extension Adviser shall be held commencing as soon as
practicable thereafter. The Extension Adviser shall be elected for the purpose
of approving certain actions of the Special Servicer specified herein in
respect of extending the maturity of any Specially Serviced Mortgage Loan
beyond the third anniversary of its original maturity date. The Extension
Adviser shall not be entitled to receive a fee for acting in such capacity.
(b) Promptly after the Closing Date and after any such receipt,
resignation, removal or determination contemplated by Section 3.26(a), the
Trustee shall call a meeting of the Holders of the Class [A], Class [B], Class
[C], Class [D] and Class [E] Certificates, if any, for the purpose of electing
an Extension Adviser. Notice of any such meeting of such Holders shall be
mailed or delivered to each Holder not less than 10 days nor more than 60 days
prior to the meeting; provided, however, that notice of the initial election
shall be mailed or delivered no later than 3 days after the Closing Date. The
notice shall state the place and the time of the meeting, which may be held by
telephone. Certificateholders representing a majority (by Certificate Balance)
of the Certificates of the applicable Class or Classes, present in person or
represented by proxy, shall constitute a quorum for the nomination of an
Extension Adviser. At the meeting, each such Holder shall be entitled to
nominate one Person to act as Extension Adviser. The Trustee shall cause the
election of the Extension Adviser to be held as soon thereafter as convenient.
(c) Each Holder of a Class [A], Class [B], Class [C], Class [D] and
Class [E] Certificate shall be entitled to vote in each election of the
Extension Adviser. The voting in each election of the Extension Adviser shall
be in writing mailed, delivered or sent by courier and actually received by the
Trustee on or prior to the date of such election. Immediately upon receipt by
the Trustee of votes (which have not been rescinded) from the Holders of such
Certificates representing more than 50% of the Voting Rights of all the Class
[A], Class [B], Class [C], Class [D] and Class [E] Certificates, which votes
are cast for a single Person, such Person shall be, upon such Person's
acceptance, the Extension Adviser. In the event that after the Closing Date an
Extension Adviser shall have resigned or been removed and a successor Extension
Adviser shall not have been elected, there shall be no Extension Adviser.
Notwithstanding anything to the contrary contained herein, the Special Servicer
shall not have any right or obligation to consult with or to seek and/or obtain
approval or direction from an Extension Adviser, and provisions of this
Agreement relating thereto shall be of no effect, in any event during any such
period that there is no Extension Adviser.
(d) The Extension Adviser may be removed at any time by the written
vote, copies of which must be delivered to the Trustee, of Holders of such
Certificates representing more
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than 50% of the Voting Rights of all the Class [A], Class [B], Class [C], Class
[D] and Class [E] Certificates.
(e) The Trustee shall act as judge of each election of an Extension
Adviser, and, absent manifest error, the determination of the results of any
such election by the Trustee shall be conclusive. Notwithstanding any other
provisions of this Section 3.26, the Trustee may make such reasonable
regulations as it may deem advisable for any such election. Upon election of a
successor Extension Adviser, the Trustee shall promptly mail notice thereof by
first class mail to the Depositor, the Servicer, the Special Servicer, the
Mortgage Loan Seller, the Directing Certificateholder, the Underwriters, the
Placement Agents, the Holders of the Class [F], Class [G] and Class [H]
Certificates and each of the Rating Agencies.
SECTION 3.27. Limitation on Liability of Extension Adviser.
The Extension Adviser will be acting solely as a representative of the
interests of the Class [A], Class [B], Class [C], Class [D] and Class [E]
Certificateholders, and shall not have any responsibility or liability to the
Trust Fund or any other Class or Classes of Certificateholders for any action
taken, or for refraining from the taking of any action, in good faith pursuant
to this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Extension Adviser against any liability which
would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of negligent disregard of
obligations or duties hereunder. By its acceptance of a Certificate, each
Certificateholder confirms its understanding that the Extension Adviser may
take actions that favor the interests of one or more Classes of the
Certificates over other Classes of the Certificates and that the Extension
Adviser may have special relationships and interests that conflict with those
of Holders of some Classes of the Certificates and, absent willful misfeasance,
bad faith, negligence or negligent disregard of obligations or duties on the
part of the Extension Adviser, agrees to take no action against the Extension
Adviser or any of its officers, directors, employees, principals or agents as a
result of such a special relationship or conflict.
[End of Article III]
ARTICLE IV.
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a) On each Distribution Date, to the extent of the Available
Distribution Amount for such Distribution Date, the Paying Agent shall transfer
the Lower-Tier Distribution Amount from the Lower-Tier Distribution Account to
the Upper-Tier Distribution Account in the amounts and priorities set forth in
Section 4.01(b) with respect to each class of Uncertificated Lower-Tier
Interests, and immediately thereafter, shall make distributions thereof from
the Upper-Tier Distribution Account in the following order of priority,
satisfying in full, to the
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extent required and possible, each priority before making any distribution with
respect to any succeeding priority:
(i) first, to the Holders of the Class [A-1] Certificates,
the Class [A-2] Certificates and the Class [X] Certificates, pro rata
(based upon their respective entitlements to interest for such
Distribution Date), in respect of interest, up to an amount equal to
the aggregate Interest Distribution Amount in respect of such Classes
of Certificates for such Distribution Date;
(ii) second, (A) to the Holders of the Class [A-1]
Certificates, in reduction of the Certificate Balance thereof, an
amount equal to the Principal Distribution Amount, until the
outstanding Certificate Balance of such Class has been reduced to zero
and (B) after the Certificate Balance of the Class [A-1] Certificates
has been reduced to zero, to the Holders of the Class [A-2]
Certificates, in reduction of the Certificate Balance thereof, an
amount equal to the Principal Distribution Amount (or the portion
thereof remaining after any distributions in respect of the Class
[A-1] Certificates on such Distribution Date), until the outstanding
Certificate Balance of such Class has been reduced to zero;
(iii) third, to the Holders of the Class [A-1] Certificates
and the Class [A-2] Certificates, pro rata (based upon the aggregate
unreimbursed Collateral Support Deficit allocated to each such Class),
until all amounts of Collateral Support Deficit previously allocated
to such Classes, but not previously reimbursed, have been reimbursed
in full;
(iv) fourth, to the Holders of the Class [B] Certificates, in
respect of interest, up to an amount equal to the aggregate Interest
Distribution Amount in respect of such Class of Certificates for such
Distribution Date;
(v) fifth, after the Certificate Balances of the Class [A-1]
and Class [A-2] Certificates have been reduced to zero, to the Holders
of the Class [B] Certificates, in reduction of the Certificate Balance
thereof, an amount equal to the Principal Distribution Amount (or the
portion thereof remaining after any distributions in respect of the
Class [A] Certificates on such Distribution Date), until the
outstanding Certificate Balance of the Class [B] Certificates has been
reduced to zero;
(vi) sixth, to the Holders of the Class [B] Certificates,
until all amounts of Collateral Support Deficit previously allocated
to the Class [B] Certificates, but not previously reimbursed, have
been reimbursed in full;
(vii) seventh, to the Holders of the Class [C] Certificates,
in respect of interest, up to an amount equal to the aggregate
Interest Distribution Amount in respect of such Class of Certificates
for such Distribution Date;
(viii) eighth, after the Certificate Balances of the Class
[A-1], Class [A-2] and Class [B] Certificates have been reduced to
zero, to the Holders of the Class [C] Certificates, in reduction of
the Certificate Balance thereof, an amount equal to the
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Principal Distribution Amount (or the portion thereof remaining after
any distributions in respect of the Class [A] and Class [B]
Certificates on such Distribution Date), until the outstanding
Certificate Balance of the Class [C] Certificates has been reduced to
zero;
(ix) ninth, to the Holders of the Class [C] Certificates,
until all amounts of Collateral Support Deficit previously allocated
to the Class [C] Certificates, but not previously reimbursed, have
been reimbursed in full;
(x) tenth, to the Holders of the Class [D] Certificates, in
respect of interest, up to an amount equal to the aggregate Interest
Distribution Amount in respect of such Class of Certificates for such
Distribution Date;
(xi) eleventh, after the Certificate Balances of the Class
[A-1], Class [A-2], Class [B] and Class [C] Certificates have been
reduced to zero, to the Holders of the Class [D] Certificates, in
reduction of the Certificate Balance thereof, an amount equal to the
Principal Distribution Amount (or the portion thereof remaining after
any distributions in respect of the Class [A], Class [B] and Class [C]
Certificates on such Distribution Date), until the outstanding
Certificate Balance of the Class [D] Certificates has been reduced to
zero;
(xii) twelfth, to the Holders of the Class [D] Certificates,
until all amounts of Collateral Support Deficit previously allocated
to the Class [D] Certificates, but not previously reimbursed, have
been reimbursed in full;
(xiii) thirteenth, to the Holders of the Class [E]
Certificates, in respect of interest, up to an amount equal to the
aggregate Interest Distribution Amount in respect of such Class of
Certificates for such Distribution Date;
(xiv) fourteenth, after the Certificate Balances of the Class
[A-1], Class [A-2], Class [B], Class [C] and Class [D] Certificates
have been reduced to zero, to the Holders of the Class [E]
Certificates, in reduction of the Certificate Balance thereof, an
amount equal to the Principal Distribution Amount (or the portion
thereof remaining after any distributions in respect of the Class [A],
Class [B], Class [C] and Class [D] Certificates on such Distribution
Date), until the outstanding Certificate Balance of the Class [E]
Certificates has been reduced to zero;
(xv) fifteenth, to the Holders of the Class [E] Certificates,
until all amounts of Collateral Support Deficit previously allocated
to the Class [E] Certificates, but not previously reimbursed, have
been reimbursed in full;
(xvi) sixteenth, to the Holders of the Class [F]
Certificates, in respect of interest, up to an amount equal to the
aggregate Interest Distribution Amount in respect of such Class of
Certificates for such Distribution Date;
(xvii) seventeenth, after the Certificate Balances of the
Class [A-1], Class [A-2], Class [B], Class [C], Class [D] and Class
[E] Certificates have been reduced to zero, to
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the Holders of the Class [F] Certificates, in reduction of the
Certificate Balance thereof, an amount equal to the Principal
Distribution Amount (or the portion thereof remaining after any
distributions in respect of the Class [A], Class [B], Class [C], Class
[D] and Class [E] Certificates on such Distribution Date), until the
outstanding Certificate Balance of the Class [F] Certificates has been
reduced to zero;
(xviii) eighteenth, to the Holders of the Class [F]
Certificates, until all amounts of Collateral Support Deficit
previously allocated to the Class [F] Certificates, but not previously
reimbursed, have been reimbursed in full;
(xix) nineteenth, to the Holders of the Class [G]
Certificates in respect of interest, up to an amount equal to the
aggregate Interest Distribution Amount in respect of such Class of
Certificates for such Distribution Date;
(xx) twentieth, after the Certificate Balances of the Class
[A-1], Class [A-2], Class [B], Class [C], Class [D], Class [E] and
Class [F] Certificates have been reduced to zero, to the Holders of
the Class [G] Certificates, in reduction of the Certificate Balance
thereof, an amount equal to the Principal Distribution Amount (or the
portion thereof remaining after any distributions in respect of the
Class [A], Class [B], Class [C], Class [D], Class [E] and Class [F]
Certificates on such Distribution Date), until the outstanding
Certificate Balance of the Class [G] Certificates has been reduced to
zero;
(xxi) twenty-first, to the Holders of the Class [G]
Certificates, until all amounts of Collateral Support Deficit
previously allocated to the Class [G] Certificates, but not previously
reimbursed, have been reimbursed in full;
(xxii) twenty-second, to the Holders of the Class [H]
Certificates in respect of interest, up to an amount equal to the
aggregate Interest Distribution Amount in respect of such Class of
Certificates for such Distribution Date;
(xxiii) twenty-third, after the Certificate Balances of the
Class [A-1], Class [A-2], Class [B], Class [C], Class [D], Class [E],
Class [F] and Class [G] Certificates have been reduced to zero, to the
Holders of the Class [H] Certificates, in reduction of the Certificate
Balance thereof, an amount equal to the Principal Distribution Amount
(or the portion thereof remaining after any distributions in respect
of the Class [A], Class [B], Class [C], Class [D], Class [E], Class
[F] and Class [G] Certificates on such Distribution Date), until the
outstanding Certificate Balance of the Class [H] Certificates has been
reduced to zero;
(xxiv) twenty-fourth, to the Holders of the Class [H]
Certificates, until all amounts of Collateral Support Deficit
previously allocated to the Class [H] Certificates, but not previously
reimbursed, have been reimbursed in full; and
(xxv) twenty-fifth, to the Holders of the Class [R]
Certificates, the amount, if any, of the Available Distribution Amount
remaining in the Upper-Tier Distribution Account with respect to such
Distribution Date.
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(b) On each Distribution Date, each Uncertificated Lower-Tier Interest
shall receive distributions in respect of principal or reimbursement of
Collateral Support Deficit in an amount equal to the amount of principal or
reimbursement of Collateral Support Deficit distributable to its respective
Related Certificates as provided in Sections 4.01(a) and (c). On each
Distribution Date, each Uncertificated Lower-Tier Interest (other than the
Class [LA-1] Uncertificated Interest and the Class [LWAC] Uncertificated
Interest) shall receive distributions in respect of interest in an amount equal
to the Interest Distribution Amount in respect of its Related Certificates, in
each case to the extent actually distributable thereon as provided in Section
4.01(a). On each Distribution Date, the Class [LA-1] Uncertificated Interest
shall receive distributions in respect of interest in an amount equal to the
sum of (i) the amount of interest distributable on the Class [A-1] Certificates
and (ii) an amount equal to the product of the Class [LA-1] Interest Fraction
and the amount of interest distributable on the Class [X] Certificates. On each
Distribution Date, the Class [LWAC] Uncertificated Interest shall receive
distributions in respect of interest for the related Interest Accrual Period in
an amount equal to one-twelfth of the product of (i) the Class [LWAC]
Pass-Through Rate and (ii) the Class [LWAC] Notional Amount. Such amounts
distributed to the Uncertificated Lower-Tier Interests in respect of principal
and interest with respect to any Distribution Date are referred to herein
collectively as the "Lower-Tier Distribution Amount," and shall be made by the
Paying Agent by depositing such Lower-Tier Distribution Amount in the
Upper-Tier Distribution Account.
As of any date, the principal balance of each Uncertificated
Lower-Tier Interest (other than the Class [LWAC] Uncertificated Interest)
equals the Certificate Balance of the Related Certificates with respect
thereto. The initial principal balance of each Uncertificated Lower-Tier
Interest equals the respective Original Lower-Tier Principal Amount. The
pass-through rate with respect to each Uncertificated Lower-Tier Interest will
be the rate per annum set forth in the Preliminary Statement hereto.
Any amount that remains in the Lower-Tier Distribution Account on each
Distribution Date after distribution of the Lower-Tier Distribution Amount
shall be distributed to the Holders of the Class [LR] Certificates (but only to
the extent of the Available Distribution Amount for such Distribution Date
remaining in the Lower-Tier Distribution Account, if any).
(c) On and after the Distribution Date on which the Certificate
Balances of the Subordinate Certificates have all been reduced to zero (without
regard to any amounts of Collateral Support Deficit remaining unreimbursed),
the Principal Distribution Amount will be distributed, pro rata (based upon
Certificate Balances), among the Class [A] Certificates without regard to the
priorities set forth in Section 4.01(a)(ii).
(d) On each Distribution Date, the Paying Agent shall withdraw from
the Lower-Tier Distribution Account an aggregate amount equal to all Prepayment
Premiums and Yield Maintenance Charges actually collected on the Mortgage Loans
or any REO Loans during the related Due Period and shall distribute such amount
in respect of the Class [LA-1] Uncertificated Interest by depositing such
amount in the Upper-Tier Distribution Account (notwithstanding that all
principal and interest distributable with respect to the Class [LA-1]
Uncertificated Interest has been paid in full).
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(e) On each Distribution Date, until the Certificate Balances of the
Class [A-1], Class [A-2], Class [B], Class [C], Class [D] and Class [E]
Certificates have each been reduced to zero, the Paying Agent shall withdraw
any amounts on deposit in the Upper-Tier Distribution Account that represent
Prepayment Premiums actually collected on Mortgage Loans or REO Loans during
the related Due Period and remitted in respect of the Class [LA-1]
Uncertificated Interest pursuant to Section 4.01(d), and shall distribute to
each of the Class [A], Class [B], Class [C], Class [D] and Class [E]
Certificates, for each such Class an amount equal to the product of (a) a
fraction, the numerator of which is the amount of principal distributed with
respect to such Class pursuant to Section 4.01(a) on such Distribution Date,
and the denominator of which is the total amount of principal distributed to
all Classes of Certificates pursuant to Section 4.01(a) on such Distribution
Date, (b) 25% and (c) the total amount of Prepayment Premiums collected during
the related Due Period. Any Prepayment Premiums received during the related Due
Period with respect to such Mortgage Loans or REO Loans and remitted in respect
of the Class [LA-1] Uncertificated Interest pursuant to Section 4.01(d),
remailing after such distributions shall be distributed on the Class [X]
Certificates.
On each Distribution Date, until the Certificate Balances of the Class
[A-1], Class [A-2], Class [B], Class [C], Class [D] and Class [E] Certificates
have each been reduced to zero, the Paying Agent shall withdraw any amounts on
deposit in the Upper-Tier Distribution Account that represent Yield Maintenance
Charges actually collected on Mortgage Loans or REO Loans during the related
Due Period and remitted in respect of the Class [LA-1] Uncertificated Interest
pursuant to Section 4.01(d), and shall distribute to each of the Class [A],
Class [B], Class [C], Class [D] and Class [E] Certificates, for each such Class
an amount equal to the product of (a) a fraction, the numerator of which is the
amount of principal distributed with respect to such Class pursuant to Section
4.01(a) on such Distribution Date, and the denominator of which is the total
amount of principal distributed to all Classes of Certificates pursuant to
Section 4.01(a) on such Distribution Date, (b) the Base Interest Fraction for
the related principal prepayment and such Class of Certificates and (c) the
aggregate amount of Yield Maintenance Charges collected on such principal
prepayment during the related Due Period. Any Yield Maintenance Charges
received during the related Due Period with respect to such Mortgage Loans and
remitted in respect of the Class [LA-1] Uncertificated Interest pursuant to
Section 4.01(d) remaining after such distributions shall be distributed on the
Class [X] Certificates.
Following the reduction of the Certificate Balances of the Class
[A-1], Class [A-2], Class [B], Class [C], Class [D] and Class [E] Certificates
to zero, the Paying Agent shall distribute 100% of any Yield Maintenance
Charges and Prepayment Premiums actually received during the related Due Period
with respect to such Mortgage Loans and remitted in respect of the Class [LA-1]
Uncertificated Interest pursuant to Section 4.01(d), to the Class [X]
Certificates.
(f) All distributions made with respect to each Class on each
Distribution Date shall be allocated pro rata among the outstanding
Certificates in such Class based on their respective Percentage Interests.
Except as otherwise specifically provided in Sections 4.01(g), 4.01(h) and
9.01, all such distributions with respect to each Class on each Distribution
Date shall be made to the Certificateholders of the respective Class of record
at the close of business on the related Record Date and shall be made by wire
transfer of immediately available funds to the account of any such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if
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such Certificateholder shall have provided the Trustee and the Paying Agent
with wiring instructions no less than 5 Business Days prior to the related
Record Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent Distribution Dates) and is the registered owner of
Certificates with an aggregate initial Certificate Balance or Notional Amount,
as applicable, of at least $5,000,000, or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
The final distribution on each Certificate (determined without regard to any
possible future reimbursement of Collateral Support Deficit previously
allocated to such Certificate) will be made in like manner, but only upon
presentation and surrender of such Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to
Certificateholders of such final distribution.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of
its Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Paying Agent, the
Trustee, the Certificate Registrar, the Depositor, the Servicer, the Special
Servicer, the Underwriters, the Placement Agents or the Fiscal Agent shall have
any responsibility therefor except as otherwise provided by this Agreement or
applicable law.
(g) Except as otherwise provided in Section 9.01, whenever the Paying
Agent expects that the final distribution with respect to any Class of
Certificates (determined without regard to any possible future reimbursement of
any amount of Collateral Support Deficit previously allocated to such Class of
Certificates) will be made on the next Distribution Date, the Paying Agent
shall, no later than the related P&I Advance Determination Date, mail to each
Holder on such date of such Class of Certificates a notice to the effect that:
(i) the Paying Agent expects that the final distribution with
respect to such Class of Certificates will be made on such
Distribution Date but only upon presentation and surrender of such
Certificates at the offices of the Certificate Registrar or such other
location therein specified; and
(ii) no interest shall accrue on such Certificates from and
after such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such
Class on such Distribution Date because of the failure of such Holder or
Holders to tender their Certificates shall, on such date, be set aside and held
uninvested in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has
been given pursuant to this Section 4.01(g) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If
101
within one year after the second notice all such Certificates shall not have
been surrendered for cancellation, the Paying Agent, directly or through an
agent, shall take such steps to contact the remaining non-tendering
Certificateholders concerning the surrender of their Certificates as it shall
deem appropriate. The costs and expenses of holding such funds in trust and of
contacting such Certificateholders following the first anniversary of the
delivery of such second notice to the non-tendering Certificateholders shall be
paid out of such funds. No interest shall accrue or be payable to any
Certificateholder on any amount held in trust hereunder by the Trustee or the
Paying Agent as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with this Section
4.01(g).
(h) Distributions in reimbursement of Collateral Support Deficit
previously allocated to the Regular Certificates shall be made in the amounts
and manner specified in Section 4.01(a) to the Holders of the respective Class
otherwise entitled to distributions of interest and principal on such Class on
the relevant Distribution Date; provided, that all distributions in
reimbursement of Collateral Support Deficit previously allocated to a Class of
Certificates which has since been retired shall be to the prior Holders that
surrendered the Certificates of such Class upon retirement thereof and shall be
made by check mailed to the address of each such prior Holder last shown in the
Certificate Register. Notice of any such distribution to a prior Holder shall
be made in accordance with Section 11.05 at such last address. The amount of
the distribution to each such prior Holder shall be based upon the aggregate
Percentage Interest evidenced by the Certificates surrendered thereby. If the
check mailed to any such prior Holder is returned uncashed, then the amount
thereof shall be set aside and held uninvested in trust for the benefit of such
prior Holder, and the Paying Agent shall attempt to contact such prior Holder
in the manner contemplated by Section 4.01(g) as if such Holder had failed to
surrender its Certificates.
SECTION 4.02. Statements to Certificateholders; Collection Reports.
(a) On each Distribution Date, the Paying Agent shall forward by mail
to all of the Holders of each Class of Certificates, the Trustee, the
Underwriters, the Placement Agents, the Servicer, the Special Servicer and a
financial market publisher (which initially shall be Bloomberg, L.P.) a
statement (substantially in the form set forth as Exhibit H hereto) as to the
distributions made on such Distribution Date (each, a "Distribution Date
Statement") setting forth:
(i) the amount of the distribution on such Distribution Date
to the Holders of such Class of Certificates in reduction of the
Certificate Balance thereof;
(ii) the amount of the distribution on such Distribution Date
to the Holders of such Class of Certificates allocable to
Distributable Certificate Interest;
(iii) the aggregate amount of P&I Advances made in respect of
such Distribution Date;
(iv) the aggregate amount of compensation paid to the Trustee
and servicing compensation paid to the Servicer during the Due Period
for such Distribution Date;
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(v) the aggregate Stated Principal Balance of the Mortgage
Loans and any REO Loans outstanding immediately before and immediately
after such Distribution Date;
(vi) the number, aggregate principal balance, weighted
average remaining term to maturity and weighted average Mortgage Rate
of the Mortgage Loans as of the end of the related Due Period for such
Distribution Date;
(vii) the number and aggregate principal balance of Mortgage
Loans (A) delinquent one month, (B) delinquent two months, (C)
delinquent three or more months and (D) as to which foreclosure
proceedings have been commenced;
(viii) the value of any REO Property included in the Trust
Fund as of the end of the related Due Period for such Distribution
Date, based on the most recent Appraisal or valuation;
(ix) the Available Distribution Amount for such Distribution
Date;
(x) the Accrued Certificate Interest in respect of such Class
of Certificates for such Distribution Date, separately identifying any
Certificate Deferred Interest for such Distribution Date allocated to
such Class of Certificates;
(xi) the amount of the distribution on such Distribution Date
to the Holders of such Class of Certificates allocable to Prepayment
Premiums and Yield Maintenance Charges;
(xii) the Pass-Through Rate for such Class of Certificates
(other than the Class [X] Certificates) and the [A-1] Component
Pass-Through Rate, and the WAC Component Pass-Through Rate in the case
of the Class [X] Certificates for such Distribution Date and the next
succeeding Distribution Date;
(xiii) the Scheduled Principal Distribution Amount and the
Unscheduled Principal Distribution Amount for such Distribution Date;
(xiv) the Certificate Balance or Notional Amount, as the case
may be, of each Class of Certificates immediately before and
immediately after such Distribution Date, separately identifying any
reduction therein as a result of the allocation of any Collateral
Support Deficit on such Distribution Date;
(xv) the Certificate Factor for each Class of Regular
Certificates immediately following such Distribution Date;
(xvi) the amount of any Appraisal Reductions effected in
connection with such Distribution Date on a loan-by-loan basis, the
total Appraisal Reduction effected in connection with such
Distribution Date and the total Appraisal Reduction Amounts as of such
Distribution Date on a loan-by-loan basis;
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(xvii) the number and related Stated Principal Balance of any
Mortgage Loans extended or modified during the related Due Period;
(xviii) the amount of any remaining Class Unpaid Interest
Shortfall for such Class as of such Distribution Date;
(xix) a loan-by-loan listing of each Mortgage Loan which was
the subject of a Principal Prepayment during the related Due Period
and the amount and the type of Principal Prepayment occurring; and
(xx) in the case of the Residual Certificates, the amount of
any distributions on such Certificates pursuant to Sections 4.01(a)
and (b).
In the case of information furnished pursuant to clauses (i), (ii),
(xi), (xviii) and (xix) above, the amounts shall be expressed as a dollar
amount in the aggregate for all Certificates of each applicable Class and per
Definitive Certificate.
Within a reasonable period of time after the end of each calendar
year, the Paying Agent shall furnish to the Trustee and each Person who at any
time during the calendar year was a Holder of a Certificate, a statement
containing the information set forth in clauses (i), (ii) and (xi) above as to
the applicable Class, aggregated for such calendar year or applicable portion
thereof during which such person was a Certificateholder, together with such
other information as the Paying Agent deems necessary or desirable, or that a
Certificateholder or Certificate Owner reasonably requests, to enable
Certificateholders to prepare their tax returns for such calendar year. Such
obligation of the Paying Agent shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Paying Agent pursuant to any requirements of the Code as from time to time are
in force.
On each Distribution Date, the Paying Agent shall forward to the
Depositor, to each Rating Agency, to each Holder of a Residual Certificate, to
the Servicer, to the Special Servicer, to the Trustee, to the Fiscal Agent, to
an agent designated by the Directing Certificateholder (such agent shall
initially be the __________), and to any other party that the Depository may
designate, a copy of the Distribution Date Statement forwarded to the Holders
of the Regular Certificates on such Distribution Date.
(b) With respect to each Distribution Date, the Servicer shall furnish
to the Paying Agent, Trustee, the Depositor, the Special Servicer and each
Rating Agency (i) a preliminary Collection Report no later than the Business
Day immediately following the related P&I Advance Determination Date and (ii)
an accurate and complete Collection Report no later than the related P&I
Advance Date, in each case containing the following information:
(i) the information to be provided to Certificateholders on
such Distribution Date pursuant to clauses (iii) through (viii) of
Section 4.02(a); and
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(ii) such other information in the Servicer's possession
regarding the Mortgage Loans and any REO Properties as the Paying
Agent or the Trustee may reasonably request to perform their
respective duties hereunder or that any Rating Agency requests.
The Collection Report may be in the form of more than one report (if
necessary and appropriate), and shall be provided by the Servicer to the Paying
Agent and the Trustee in such format(s) as the Servicer, the Paying Agent and
the Trustee may agree. None of the Paying Agent, the Trustee or the Depositor
shall have any obligation to recompute, verify or recalculate the information
provided thereto by the Servicer in the Collection Report. Unless the Paying
Agent has actual knowledge that any Collection Report contains erroneous
information, the Paying Agent is authorized to rely thereon in calculating and
making distributions to Certificateholders in accordance with Section 4.01,
preparing the statements to Certificateholders required by Section 4.02(a) and
allocating Collateral Support Deficit to the Certificates in accordance with
Section 4.04.
(c) As soon as reasonably practicable, upon the written request of any
Certificateholder, the Servicer shall provide the requesting Certificateholder
with such information that is in the Servicer's possession or can reasonably be
obtained by the Paying Agent or the Trustee as is requested by such
Certificateholder, for purposes of satisfying applicable reporting requirements
under Rule 144A under the Securities Act. In addition, pursuant to Section
8.12(b), the Servicer shall provide a financial market publisher (which shall
initially be Bloomberg, L.P.) certain current information with respect to the
Mortgaged Properties as set forth on Schedule I hereto.
(d) The Paying Agent shall file with the Commission, in respect of the
Trust Fund, the Uncertificated Lower-Tier Interests and the Certificates,
copies of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) required to be filed with the Commission
pursuant to Section 13 or 15 (d) of the Exchange Act (including Distribution
Date Statements issued pursuant to Section 4.02(a) by means of a Current Report
on Form 8-K and an Annual Report on Form 10-K). In the event that the Depositor
determines that electronic filing through the ▇▇▇▇▇ System is required for any
reports, the Depositor may either (x) request that the Paying Agent process
such filing or (y) cause the filing to be processed by the Depositor or its
designee upon receipt from the Paying Agent of the reports, documents and other
information described above. Notwithstanding the foregoing, the Depositor shall
file with the Commission, within fifteen days after the Closing Date, a Current
Report on Form 8-K together with this Agreement.
SECTION 4.03. P&I Advances.
(a) On or before 12:30 p.m., New York City time, on each P&I Advance
Date, the Servicer shall either (i) deposit into the Distribution Account from
its own funds an amount equal to the aggregate amount of P&I Advances, if any,
to be made in respect of the related Distribution Date, (ii) apply amounts held
in the Certificate Account for future distribution to Certificateholders in
subsequent months in discharge of any such obligation to make P&I Advances or
(iii) make P&I Advances in the form of any combination of (i) and (ii)
aggregating
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the total amount of P&I Advances to be made. Any amounts held in the
Certificate Account for future distribution and so used to make P&I Advances
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Certificate Account on or before the next succeeding
P&I Advance Determination Date (to the extent not previously replaced through
the deposit of Late Collections of the delinquent principal and/or interest in
respect of which such P&I Advances were made). The Servicer shall notify the
Trustee and the Fiscal Agent by a certificate of the Servicing Officer of (i)
the aggregate amount of P&I Advances for a Distribution Date and (ii) the
amount of any Nonrecoverable P&I Advances for such Distribution Date, on or
before 3 Business Days prior to such Distribution Date. If the Servicer fails
to make a required P&I Advance by 12:30 p.m., New York City time, on any P&I
Advance Date, an Event of Default as set forth in clause (a)(i) of Section 7.01
shall occur and the Trustee shall make such P&I Advance pursuant to Section
7.05, and if the Trustee fails to make such P&I Advance by the close of
business, New York City time, on such P&I Advance Date, the Fiscal Agent shall
make such P&I Advance pursuant to Section 7.05 by 10:00 a.m., New York City
time, on the immediately succeeding Business Day. In the event that the
Servicer fails to make a required P&I Advance hereunder, the Paying Agent shall
notify the Trustee and the Fiscal Agent of such circumstances by 1:00 p.m. (New
York City time) on the related P&I Advance Date.
(b) Subject to Section 4.03(c) and (e) below, the aggregate amount of
P&I Advances to be made by the Servicer with respect to any Distribution Date
shall equal the aggregate of: (i) all Monthly Payments (in each case, net of
related Servicing Fees) other than Balloon Payments, that were due during the
related Due Period and delinquent as of the close of business on the Business
Day preceding the related P&I Advance Date (or not advanced by any Sub-Servicer
on behalf of the Servicer) and (ii) with respect to each Mortgage Loan as to
which the related Balloon Payment was due during or prior to the related Due
Period and was delinquent as of the end of the related Due Period (including
any REO Loan as to which the Balloon Payment would have been past due), an
amount equal to the Assumed Scheduled Payment therefor. Subject to subsection
(c) below, the obligation of the Servicer to make such P&I Advances is
mandatory, and with respect to any Mortgage Loan or REO Loan, shall continue
until the Distribution Date on which the proceeds, if any, received in
connection with a Liquidation Event with respect thereto are to be distributed.
(c) Notwithstanding anything herein to the contrary, no P&I Advance
shall be required to be made hereunder if such P&I Advance would, if made,
constitute a Nonrecoverable P&I Advance.
(d) In connection with the recovery of any P&I Advance out of the
Certificate Account pursuant to Section 3.05(a), the Servicer shall be entitled
to pay itself, the Trustee or the Fiscal Agent, as the case may be (in reverse
of such order with respect to any Mortgage Loan), out of any amounts then on
deposit in the Certificate Account, interest at the Reimbursement Rate in
effect from time to time, accrued on the amount of such P&I Advance from the
date made to but not including the date of reimbursement. The Servicer shall
reimburse itself, the Trustee or the Fiscal Agent, as the case may be, for any
outstanding P&I Advance as soon as practicably possible after funds available
for such purpose are deposited in the Certificate Account.
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(e) Notwithstanding the foregoing, (i) none of the Servicer, the
Trustee and the Fiscal Agent shall be required to make an advance for Penalty
Charges, Prepayment Premiums or Yield Maintenance Charges and (ii) the amount
required to be advanced in respect of delinquent Monthly Payments or Assumed
Scheduled Payments on Mortgage Loans that have been subject to an Appraisal
Reduction Event will equal, with respect to any Distribution Date and any
Mortgage Loan, the amount that would be required to be advanced by the Servicer
without giving effect to the Appraisal Reduction less any Appraisal Reduction
Amount with respect to such Mortgage Loan for such Distribution Date.
SECTION 4.04. Allocation of Collateral Support Deficit.
(a) On each Distribution Date, immediately following the distributions
to be made on such date pursuant to Section 4.01 and the allocation of
Certificate Deferred Interest pursuant to Section 4.06, the Paying Agent shall
calculate the amount, if any, by which (i) the aggregate Stated Principal
Balance of the Mortgage Loans and any REO Loans expected to be outstanding
immediately following such Distribution Date, is less than (ii) the then
aggregate Certificate Balance of the Regular Certificates after giving effect
to distributions of principal on such Distribution Date and the allocation of
Certificate Deferred Interest pursuant to Section 4.06 (any such deficit, the
"Collateral Support Deficit"). Any allocation of Collateral Support Deficit to
a Class of Regular Certificates shall be made by reducing the Certificate
Balance thereof by the amount so allocated. Any Collateral Support Deficit
allocated to a Class of Regular Certificates shall be allocated among the
respective Certificates of such Class in proportion to the Percentage Interests
evidenced thereby. The allocation of Collateral Support Deficit shall
constitute an allocation of losses and other shortfalls experienced by the
Trust Fund. Reimbursement of previously allocated Collateral Support Deficit
will not constitute distributions of principal for any purpose and will not
result in an additional reduction in the Certificate Balance of the Class of
Certificates in respect of which any such reimbursement is made.
(b) On each Distribution Date, the Certificate Balances of the Regular
Certificates will be reduced without distribution as a write-off to the extent
of any Collateral Support Deficit, if any, allocable to such Certificates with
respect to such Distribution Date. Any such write-off shall be allocated among
the respective Certificates as follows: first, to the Class [H] Certificates;
second, to the Class [G] Certificates; third, to the Class [F] Certificates;
fourth, to the Class [E] Certificates; fifth, to the Class [D] Certificates;
sixth, to the Class [C] Certificates; seventh, to the Class [B] Certificates,
in each case, until the remaining Certificate Balance of each such Class of
Certificates has been reduced to zero and eighth, to the Class [A-1]
Certificates and the Class [A-2] Certificates, pro rata (based upon Certificate
Balance), until the remaining Certificate Balances of such Classes of
Certificates have been reduced to zero.
(c) With respect to any Distribution Date, any Collateral Support
Deficit allocated to a Class of Certificates pursuant to Section 4.04(b) with
respect to such Distribution Date shall reduce the Lower-Tier Principal Amounts
of the Related Uncertificated Lower-Tier Interest with respect thereto as a
write-off.
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SECTION 4.05. Appraisal Reductions.
The aggregate Appraisal Reduction will be allocated by the Paying
Agent on each Distribution Date, only for purposes of determining the identity
of the Controlling Class and Voting Rights and the amount of P&I Advances with
respect to the related Mortgage Loan, to the Certificate Balance of the Class
[H], Class [G], Class [F], Class [E], Class [D], Class [C] and Class [B]
Certificates, in that order, up to the amount of their respective Certificate
Balances. On any Distribution Date, an Appraisal Reduction that otherwise would
be allocated to a Class of Certificates will be allocated to the next most
subordinate Class to the extent that the Certificate Balance on such
Distribution Date for such Class of Certificates (prior to taking the Appraisal
Reduction into account) is less than the Appraisal Reduction for such
Distribution Date.
SECTION 4.06. Certificate Deferred Interest.
(a) On each Distribution Date, the amount of interest distributable to
a Class of Certificates (other than the Class [X] Certificates) shall be
reduced by an amount equal to the amount of Mortgage Deferred Interest for all
Mortgage Loans for the Due Dates occurring in the related Due Period allocated
to such Class of Certificates, such Mortgage Deferred Interest to be allocated
first to the Class [H] Certificates, second to the Class [G] Certificates,
third to the Class [F] Certificates, fourth to the Class [E] Certificates,
fifth to the Class [D] Certificates, sixth to the Class [C] Certificates,
seventh to the Class [B] Certificates and eighth, pro rata (based upon Accrued
Certificate Interest), to the Class [A-1] and Class [A-2] Certificates, in each
case up to the respective Accrued Certificate Interest for each such Class of
Certificates for such Distribution Date.
(b) On each Distribution Date, the Certificate Balances of the Class
[A-1], Class [A-2], Class [B], Class [C], Class [D], Class [E], Class [F],
Class [G] and Class [H] Certificates shall be increased by the amount of the
Certificate Deferred Interest allocated to such Class of Certificates on such
Distribution Date pursuant to Section 4.06(a) above.
(c) With respect to any Distribution Date, any Certificate Deferred
Interest with respect to such Distribution Date allocated pursuant to Section
4.06(a) to a Class of Certificates shall be allocated in reduction of the
amount of interest distributable to the Related Uncertificated Lower-Tier
Interest with respect thereto. On each Distribution Date, to the extent
provided in Section 4.06(b), Certificate Deferred Interest will be added to the
Lower-Tier Principal Amount of the Uncertificated Lower-Tier Interests in the
same manner as the interest thereon was reduced pursuant to the preceding
sentence.
[End of Article IV]
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ARTICLE V.
THE CERTIFICATES
SECTION 5.01. The Certificates.
(a) The Certificates will be substantially in the respective forms
annexed hereto as Exhibits A-1 through and including A-12. The Certificates
will be issuable in registered form only; provided, however, that in accordance
with Section 5.03 beneficial ownership interests in the Regular Certificates
shall initially be held and transferred through the book-entry facilities of
the Depository. The Class [R] and Class [LR] Certificates will each be issuable
in one or more registered, definitive physical certificates (each, a
"Definitive Certificate") substantially in the form of Certificates of each
Class and with such applicable legends as are set forth in the Exhibits hereto
corresponding to such Class. Each Certificate will share ratably in all rights
of the related Class. The Class [X] Certificates will be issuable only in
minimum Denominations of authorized initial Notional Amount of not less than
$1,000,000 and in integral multiples of $1,000 in excess thereof. The Offered
Certificates (other than the Class [X] Certificates) will be issuable only in
minimum Denominations of authorized initial Certificate Balance of not less
than $25,000, and in integral multiples of $1,000 in excess thereof. The
Non-Registered Certificates (other than the Residual Certificates) will be
issuable in minimum Denominations of authorized initial Certificate Balance of
not less than $250,000, and in integral multiples of $1,000 in excess thereof.
If the Original Certificate Balance or initial Notional Amount, as applicable,
of any Class does not equal an integral multiple of $1,000, then a single
additional Certificate of such Class may be issued in a minimum denomination of
authorized initial Certificate Balance or initial Notional Amount, as
applicable, that includes the excess of (i) the Original Certificate Balance or
initial Notional Amount, as applicable, of such Class over (ii) the largest
integral multiple of $1,000 that does not exceed such amount. The Class [R] and
Class [LR] Certificates will be issuable only in one or more Definitive
Certificates in denominations representing Percentage Interests of not less
than 20%. With respect to any Certificate or any beneficial interest in a
Certificate, the "Denomination" thereof shall be (i) the amount (a) set forth
on the face thereof or, (b) set forth on a schedule attached thereto or (c) in
the case of any beneficial interest in a Book-Entry Certificate, the interest
of the related Certificate Owner in the applicable Class of Certificates as
reflected on the books and records of the Depository or related Participants,
as applicable, (ii) expressed in terms of initial Certificate Balance or
initial Notional Amount, as applicable, and (iii) be in an authorized
denomination, as set forth above. The Book-Entry Certificates will be issued as
one or more certificates registered in the name of a nominee designated by the
Depository, and Certificate Owners will hold interests in the Book-Entry
Certificates through the book-entry facilities of the Depository in the minimum
Denominations and aggregate Denominations as set forth in the above. No
Certificate Owner of a Book-Entry Certificate of any Class thereof will be
entitled to receive a Definitive Certificate representing its interest in such
Class, except as provided in Section 5.03 herein. Unless and until Definitive
Certificates are issued in respect of a Class of Book-Entry Certificates,
beneficial ownership interests in such Class of Certificates will be maintained
and transferred on the book-entry records of the Depository and Depository
Participants, and all references to actions by Holders of such Class of
Certificates will refer to action taken by the Depository upon instructions
received from the related registered Holders
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of Certificates through the Depository Participants in accordance with the
Depository's procedures and, except as otherwise set forth herein, all
references herein to payments, notices, reports and statements to Holders of
such Class of Certificates will refer to payments, notices, reports and
statements to the Depository or its nominee as the registered Holder thereof,
for distribution to the related registered Holders of Certificates through the
Depository Participants in accordance with the Depository's procedures.
(b) The Certificates shall be executed by manual or facsimile
signature on behalf of the Certificate Registrar by an authorized officer.
Certificates bearing the manual or facsimile signatures of individuals who were
at any time the authorized officers of the Certificate Registrar shall be
entitled to all benefits under this Agreement, subject to the following
sentence, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Certificates
or did not hold such offices at the date of such Certificates. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, however, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Authenticating Agent by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
___________________, ______________________, is hereby initially appointed
Authenticating Agent with power to act on the Trustee's behalf in the
authentication and delivery of the Certificates in connection with transfers
and exchanges as herein provided. If ______________ resigns or is removed as
Servicer in accordance with the terms hereof, _______________ shall be entitled
to immediately resign as Authenticating Agent by giving written notice thereof
to the Trustee and the Servicer. If ___________________ is removed as Servicer
pursuant to an Event of Default described in Section 7.01(a)(v), (vi) or (vii),
then ___________________ shall be terminated as Authenticating Agent. If the
Authenticating Agent resigns or is terminated, the Trustee shall appoint a
successor Authenticating Agent which may be the Trustee or an Affiliate
thereof.
(c) Any of the Certificates may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Agreement, as may be required to comply with any law or with rules or
regulations pursuant thereto, or with the rules of any securities market in
which the Certificates are admitted to trading, or to conform to general usage.
SECTION 5.02. Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such reasonable regulations as the Certificate Registrar may
prescribe, the Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
________________, ____________________ is hereby initially appointed
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided. The Certificate Registrar may
appoint, by a written instrument delivered to the
110
Depositor, the Trustee, the Special Servicer, the Servicer and the Fiscal
Agent, any other bank or trust company to act as Certificate Registrar under
such conditions as the predecessor Certificate Registrar may prescribe,
provided that the predecessor Certificate Registrar shall not be relieved of
any of its duties or responsibilities hereunder by reason of such appointment.
If the Certificate Registrar resigns or is removed in accordance with the terms
hereof, the Trustee shall immediately succeed to its predecessor's duties as
Certificate Registrar. The Depositor, the Trustee, the Paying Agent, the
Servicer and the Special Servicer shall have the right to inspect the
Certificate Register or to obtain a copy thereof at all reasonable times, and
to rely conclusively upon a certificate of the Certificate Registrar as to the
information set forth in the Certificate Register. The names and addresses of
all Certificateholders and the names and addresses of the transferees of any
Certificates shall be registered in the Certificate Register; provided,
however, in no event shall the Certificate Registrar be required to maintain in
the Certificate Register the names of Certificate Owners. The Person in whose
name any Certificate is so registered shall be deemed and treated as the sole
owner and Holder thereof for all purposes of this Agreement and the Certificate
Registrar, the Servicer, the Trustee, the Fiscal Agent, the Paying Agent, the
Special Servicer and any agent of any of them shall not be affected by any
notice or knowledge to the contrary. A Definitive Certificate is transferable
or exchangeable only upon the surrender of such Certificate to the Certificate
Registrar at its office maintained at ________________________________ or at
the Corporate Trust Office, if the Trustee is the Certificate Registrar (the
"Registrar Office") together with an assignment and transfer (executed by the
Holder or his duly authorized attorney). Subject to the requirements of
Sections 5.02(b), (c) and (d), the Certificate Registrar shall execute and the
Authenticating Agent shall duly authenticate in the name of the designated
transferee or transferees, one or more new Certificates in Denominations of a
like aggregate Denomination as the Definitive Certificate being surrendered.
Such Certificates shall be delivered by the Certificate Registrar in accordance
with Section 5.02(e). Each Certificate surrendered for registration of transfer
shall be canceled, and the Certificate Registrar shall hold such canceled
Certificates in accordance with its standard procedures.
(b) No transfer of any Non-Registered Certificate shall be made unless
that transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If a transfer (other than one by the Depositor
to an Affiliate thereof) is to be made in reliance upon an exemption from the
Securities Act, and under the applicable state securities laws, then either:
(i) the Certificate Registrar shall require that the transferee deliver to the
Certificate Registrar an investment representation letter (the "Investment
Representation Letter") substantially in the form of Exhibit C attached hereto,
which Investment Representation Letter shall certify, among other things, that
the transferee is an institutional "accredited investor" as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act (an
"Institutional Accredited Investor") or a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act (a "Qualified Institutional
Buyer"), and the Certificate Registrar may also require that the transferee
deliver to the Certificate Registrar an Opinion of Counsel if such transferee
is not a Qualified Institutional Buyer or (ii) if the certifications described
in the preceding clause (i) cannot be provided, (a) the Certificate Registrar
shall require an Opinion of Counsel reasonably satisfactory to the Certificate
Registrar and the Depositor that such transfer may be made
111
pursuant to an exemption, describing the applicable exemption and the basis
therefor, from registration or qualification under the Securities Act,
applicable state securities laws and other relevant laws, which Opinion of
Counsel shall not be an expense of the Trust Fund, the Certificate Registrar,
the Depositor or the Trustee and (b) the Certificate Registrar shall require
the transferor to execute a certification in form and substance satisfactory to
the Certificate Registrar setting forth the facts surrounding such transfer;
provided, however, that a transfer of a Non-Registered Certificate of any such
Class may be made to a trust if the transferor provides to the Certificate
Registrar and to the Trustee a certification that interests in such trust may
only be transferred subject to requirements substantially to the effect set
forth in this Section 5.02. The Servicer will furnish, or cause to be
furnished, upon the request of any Holder of Non-Registered Certificates, to a
prospective purchaser of such Non-Registered Certificates who is a Qualified
Institutional Buyer, such information as is specified in paragraph (d)(4) of
Rule 144A with respect to the Trust Fund, unless, at the time of such request,
the entity with respect to which such information is to be provided is subject
to the reporting requirements of Section 15(d) of the Exchange Act. None of the
Depositor, the Trustee, the Fiscal Agent, the Servicer or the Certificate
Registrar is obligated to register or qualify any Class of Non-Registered
Certificates under the Securities Act or any other securities law or to take
any action not otherwise required under this Agreement to permit the transfer
of any Non-Registered Certificate without registration or qualification. Any
Holder of a Non-Registered Certificate desiring to effect such a transfer
shall, and does hereby agree to, indemnify the Depositor, the Trustee, the
Servicer and the Certificate Registrar against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal
and state laws. Unless the Certificate Registrar determines otherwise in
accordance with applicable law and the rules and procedures of, or applicable
to, the Depository (the "Depository Rules"), transfers of a beneficial interest
in a Book-Entry Certificate representing an interest in a Non-Registered
Certificate that is not rated in one of the top four categories by a nationally
recognized statistical rating organization to (i) an Institutional Accredited
Investor will require delivery in the form of a Definitive Certificate and the
Certificate Registrar shall register such transfer only upon compliance with
the foregoing provisions of this Section 5.02(b) or (ii) a Qualified
Institutional Buyer may only be effectuated by means of an "SRO Rule 144A
System" approved for such purpose by the Commission.
Unless the Non-Registered Certificates have been registered under the
Securities Act, each of the Non-Registered Certificates shall bear a legend
substantially to the following effect:
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR
NOT SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES
NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN
ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND (a)
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PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT, (b) FOR SO LONG AS THIS CERTIFICATE IS ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHO
THE SELLER REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED
IN RULE 144A IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (c) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501 (a)(1), (2),
(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, OR (d) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO THE COMPLETION AND
DELIVERY BY THE TRANSFEROR TO THE CERTIFICATE REGISTRAR OF A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THE LAST PAGE OF THIS CERTIFICATE.
THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT
PURCHASER OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST
HEREIN, IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT. A TRANSFEREE IS ALSO REQUIRED
TO DELIVER AN INVESTMENT REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF
EXHIBIT C TO THE POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A
QUALIFIED INSTITUTIONAL BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND MAY
ALSO BE REQUIRED TO DELIVER AN OPINION OF COUNSEL IF SUCH TRANSFEREE IS NOT A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A.
(c) With respect to the Subordinate Certificates, no sale, transfer,
pledge or other disposition by any Holder of any such Certificate shall be made
unless the Certificate Registrar shall have received either (i) a
representation letter from the proposed purchaser or transferee of such
Certificate substantially in the form of Exhibit G attached hereto, to the
effect that such proposed purchaser or transferee is not (a) an employee
benefit plan subject to the fiduciary responsibility provisions of ERISA or
Section 4975 of the Code, or a governmental plan (as defined in Section 3(32)
of ERISA) subject to any federal, state or local law ("Similar Law") which is,
to a material extent, similar to the foregoing provisions of ERISA or the Code
(each a "Plan") or (b) a person acting on behalf of or using the assets of any
such Plan (including an entity whose underlying assets include Plan assets by
reason of investment in the entity by such Plan and the application of
Department of Labor Regulation ss. 2510.3-101), other than an insurance company
using the assets of its general account under circumstances whereby the
purchase and holding of such Certificates by such insurance company would be
exempt from the prohibited transaction provisions of ERISA and the Code under
Prohibited Transaction Class Exemption 95-60 or (ii) if such Certificate is
presented for registration in the name of a purchaser or transferee that is any
of the foregoing, an Opinion of Counsel in form and substance satisfactory to
the Certificate Registrar and the Depositor to the effect that the acquisition
and holding of such Certificate by such purchaser or transferee will not result
in the assets of the Trust Fund being deemed to be "plan assets" and subject to
the fiduciary
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responsibility provisions of ERISA, the prohibited transaction provisions of
the Code or the provisions of any Similar Law, will not constitute or result in
a "prohibited transaction" within the meaning of ERISA, Section 4975 of the
Code or any Similar Law, and will not subject the Trustee, the Certificate
Registrar, the Servicer, the Special Servicer, the Fiscal Agent, the Paying
Agent, the Extension Adviser, the Underwriters, the Placement Agents or the
Depositor to any obligation or liability (including obligations or liabilities
under ERISA, Section 4975 of the Code or any such Similar Law) in addition to
those set forth in the Agreement. The Certificate Registrar shall not register
the sale, transfer, pledge or other disposition of any such Certificate unless
the Certificate Registrar has received either the representation letter
described in clause (i) above or the Opinion of Counsel described in clause
(ii) above. The costs of any of the foregoing representation letters or
Opinions of Counsel shall not be borne by any of the Depositor, the Servicer,
the Special Servicer, the Fiscal Agent, the Trustee and the Trust Fund. Each
Certificate Owner of a Subordinate Certificate shall be deemed to represent
that it is not a Person specified in clauses (a), or (b) above. Any transfer,
sale, pledge or other disposition of any such Certificates that would
constitute or result in a prohibited transaction under ERISA, Section 4975 of
the Code or any Similar Law, or would otherwise violate the provisions of this
Section 5.02(c) shall be deemed absolutely null and void ab initio, to the
extent permitted under applicable law.
So long as any of the Class of Certificates remains outstanding, the
Servicer will make available, or cause to be made available, upon request, to
any Holder and any Person to whom any such Certificate of any such Class of
Certificates may be offered or sold, transferred, pledged or otherwise disposed
of by such Holder, information with respect to the Servicer, the Special
Servicer or the Mortgage Loans necessary to the provision of an Opinion of
Counsel described in this Section 5.02(c).
(d)(i) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and
to have irrevocably authorized the Paying Agent under clause (ii) below to
deliver payments to a Person other than such Person. The rights of each Person
acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(A) No Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Disqualified Organization or agent
thereof (including a nominee, middleman or similar person) (an
"Agent"), a Plan or a Person acting on behalf of or investing the
assets of a Plan (such Plan or Person, an "ERISA Prohibited Holder")
or a Non-U.S. Person and shall promptly notify the Servicer, the
Trustee and the Certificate Registrar of any change or impending
change to such status;
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate, the Certificate Registrar shall
require delivery to it, and no Transfer of any Residual Certificate
shall be registered until the Certificate Registrar receives, an
affidavit substantially in the form attached hereto as Exhibit D-1 (a
"Transfer Affidavit") from the proposed Transferee, in form and
substance satisfactory to the Certificate Registrar, representing and
warranting, among other things, that such Transferee is not
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a Disqualified Organization or Agent thereof, an ERISA Prohibited
Holder or a Non-U.S. Person, and that it has reviewed the provisions
of this Section 5.02(d) and agrees to be bound by them;
(C) Notwithstanding the delivery of a Transfer Affidavit by a
proposed Transferee under clause (b) above, if the Certificate
Registrar has actual knowledge that the proposed Transferee is a
Disqualified Organization or Agent thereof, an ERISA Prohibited Holder
or a Non-U.S. Person, no Transfer of an Ownership Interest in a
Residual Certificate to such proposed Transferee shall be effected;
and
(D) Each Person holding or acquiring any Ownership Interest
in a Residual Certificate shall agree (1) to require a Transfer
Affidavit from any prospective Transferee to whom such Person attempts
to transfer its Ownership Interest in such Residual Certificate and
(2) not to transfer its Ownership Interest in such Residual
Certificate unless it provides to the Certificate Registrar a letter
substantially in the form attached hereto as Exhibit D-2 (a
"Transferor Letter") certifying that, among other things, it has no
actual knowledge that such prospective Transferee is a Disqualified
Organization or Agent thereof, an ERISA Prohibited Holder or a
Non-U.S. Person.
(ii) If any purported Transferee shall become a Holder of a
Residual Certificate in violation of the provisions of this Section
5.02(d), then the last preceding Holder of such Residual Certificate
that was in compliance with the provisions of this Section 5.02(d)
shall be restored, to the extent permitted by law, to all rights as
Holder thereof retroactive to the date of registration of such
Transfer of such Residual Certificate. None of the Trustee, the
Servicer, the Authenticating Agent and the Certificate Registrar shall
be under any liability to any Person for any registration of Transfer
of a Residual Certificate that is in fact not permitted by this
Section 5.02(d) or for making any payments due on such Certificate to
the Holder thereof or for taking any other action with respect to such
Holder under the provisions of this Agreement; provided, however, that
the Certificate Registrar shall be under such liability for a
registration of Transfer of a Residual Certificate if it has actual
knowledge that the proposed Transferee is a Disqualified Organization
or Agent thereof, an ERISA Prohibited Holder or a Non-U.S. Person in
violation of Section 5.02(d)(i)(C) above.
(iii) The Servicer shall make available to the Internal
Revenue Service and those Persons specified by the REMIC Provisions,
upon written request of the Trustee, all information in its possession
and necessary to compute any tax imposed as a result of the Transfer
of an Ownership Interest in a Residual Certificate to any Person who
is a Disqualified Organization or Agent thereof, including the
information described in Treasury regulations sections 1.860D-l(b)(5)
and 1.860E-2(a)(5) with respect to the "excess inclusions" of such
Residual Certificate.
(e) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the Holder of any Definitive Certificate may transfer or
exchange the same in whole or in part (with a Denomination equal to any
authorized denomination) by surrendering such Certificate at the Registrar
Office or at the office of any successor Certificate Registrar or transfer
agent
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appointed by the Certificate Registrar, together with an instrument of
assignment or transfer (executed by the Holder or its duly authorized
attorney), in the case of transfer, and a written request for exchange in the
case of exchange. Subject to the restrictions on transfer set forth in this
Section 5.02 and Depository Rules, any Certificate Owner owning a beneficial
interest in a Non-Registered Certificate may cause the Certificate Registrar to
request that the Depository exchange such Certificate Owner's beneficial
interest in a Book-Entry for a Definitive Certificate or Certificates.
Following a proper request for transfer or exchange, the Certificate Registrar
shall, within 5 Business Days of such request if made at such Registrar Office,
or within 10 Business Days if made at the office of a transfer agent (other
than the Certificate Registrar), execute and deliver at such Registrar Office
or at the office of such transfer agent, as the case may be, to the transferee
(in the case of transfer) or Holder (in the case of exchange) or send by first
class mail (at the risk of the transferee in the case of transfer or Holder in
the case of exchange) to such address as the transferee or Holder, as
applicable, may request, a Definitive Certificate or Certificates, as the case
may require, for a like aggregate Denomination and in such Denomination or
Denominations as may be requested. The presentation for transfer or exchange of
any Definitive Certificate shall not be valid unless made at the Registrar
Office or at the office of a transfer agent by the registered Holder in person,
or by a duly authorized attorney-in-fact. The Certificate Registrar may decline
to accept any request for an exchange or registration of transfer of any
Certificate during the period of 15 days preceding any Distribution Date.
(f) In the event a Responsible Officer of the Certificate Registrar
becomes aware that a Definitive Certificate (other than a Definitive
Certificate issued in exchange for a Certificate representing an interest in
the Class [A-1], Class [A-2], Class [B], Class [C], Class [D], Class [E] or
Class [X] Certificates) or a beneficial interest in a Book-Entry Certificate
representing a Non-Registered Certificate is being held by or for the benefit
of a Person who is not an Eligible Investor, or that such holding is unlawful
under the laws of a relevant jurisdiction, then the Certificate Registrar shall
have the right to void such transfer, if permitted under applicable law, or to
require the investor to sell such Definitive Certificate or beneficial interest
in such Book-Entry Certificate to an Eligible Investor within 14 days after
notice of such determination and each Certificateholder, by its acceptance of a
Certificate authorizes the Certificate Registrar to take such action.
(g) The Certificate Registrar shall provide notice to the Trustee, the
Servicer, the Special Servicer, the Paying Agent and the Depositor of each
transfer of a Certificate and to provide each such Person with an updated copy
of the Certificate Register on or about and of each year, commencing
__________, 1998.
(h) No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange referred to in this Section 5.02 except as provided below. In
connection with any transfer to an Institutional Accredited Investor, the
transferor shall reimburse the Trust Fund for any costs (including the cost of
the Certificate Registrar's counsel's review of the documents and any legal
opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided herein) incurred by the Certificate Registrar in
connection with such transfer. With respect to any transfer or exchange of any
Certificate, the Certificate Registrar may require payment by each transferor
of a sum
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sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
(i) All Certificates surrendered for transfer and exchange shall be
physically canceled by the Certificate Registrar, and the Certificate
Registrar shall hold such canceled Certificates in accordance with its
standard procedures.
SECTION 5.03. Book-Entry Certificates.
(a) The Regular Certificates shall initially be issued as one or more
Certificates registered in the name of the Depository or its nominee and,
except as provided in subsection (c) below, transfer of such Certificates may
not be registered by the Certificate Registrar unless such transfer is to a
successor Depository that agrees to hold such Certificates for the respective
Certificate Owners with Ownership Interests therein. Such Certificate Owners
shall hold and transfer their respective Ownership Interests in and to such
Certificates through the book-entry facilities of the Depository and, except as
provided in Section 5.02(e) above or subsection (c) below, shall not be
entitled to Definitive Certificates in respect of such Ownership Interests. All
transfers by Certificate Owners of their respective Ownership Interests in the
Book-Entry Certificates shall be made in accordance with the procedures
established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall only transfer the
Ownership Interests in the Book-Entry Certificates of Certificate Owners it
represents or of brokerage firms for which it acts as agent in accordance with
the Depository's normal procedures.
(b) The Trustee, the Servicer, the Special Servicer, the Paying Agent,
the Fiscal Agent, the Depositor and the Certificate Registrar may for all
purposes, including the making of payments due on the Book-Entry Certificates,
deal with the Depository as the authorized representative of the Certificate
Owners with respect to such Certificates for the purposes of exercising the
rights of Certificateholders hereunder. The rights of Certificate Owners with
respect to the Book-Entry Certificates shall be limited to those established by
law and agreements between such Certificate Owners and the Depository
Participants and brokerage firms representing such Certificate Owners. Multiple
requests and directions from, and votes of, the Depository as Holder of the
Book-Entry Certificates with respect to any particular matter shall not be
deemed inconsistent if they are made with respect to different Certificate
Owners. The Trustee may establish a reasonable record date in connection with
solicitations of consents from or voting by Certificateholders and shall give
notice to the Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee, the Paying Agent and
the Certificate Registrar in writing that the Depository is no longer willing
or able to properly discharge its responsibilities with respect to the
Book-Entry Certificates and (B) the Depositor is unable to locate a qualified
successor, or (ii) the Depositor at its option advises the Trustee, the Paying
Agent and the Certificate Registrar in writing that it elects to terminate the
book-entry system through the Depository, the Paying Agent shall notify the
affected Certificate Owners, through the Depository with respect to all, any
Class or any portion of any Class of the Certificates or (iii) the Trustee
determines that Definitive Certificates are required in accordance with the
provisions of Section 5.03(e), of the occurrence of any such event and of the
availability of
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Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Certificate Registrar of the Book-Entry Certificates by the
Depository or any custodian acting on behalf of the Depository, accompanied by
registration instructions from the Depository for registration of transfer, the
Certificate Registrar shall execute, and the Authenticating Agent shall
authenticate and deliver, within 5 Business Days of such request if made at the
Registrar Office, or within 10 Business Days if made at the office of a
transfer agent (other than the Certificate Registrar), the Definitive
Certificates to the Certificate Owners identified in such instructions. None of
the Depositor, the Fiscal Agent, the Paying Agent, the Servicer, the Trustee,
the Special Servicer, the Authenticating Agent and the Certificate Registrar
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates for purposes of evidencing
ownership of any Class of Certificates, the registered Holders of such
Definitive Certificates shall be recognized as Certificateholders hereunder
and, accordingly, shall be entitled directly to receive payments on, to
exercise Voting Rights with respect to, and to transfer and exchange such
Definitive Certificates.
(d) The Book-Entry Certificates (i) shall be delivered by the
Certificate Registrar to the Depository, or pursuant to the Depository's
instructions, and shall be registered in the name of Cede & Co. and (ii) shall
bear a legend substantially to the following effect:
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to
the Certificate Registrar for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede
& Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
The Book-Entry Certificates may be deposited with such other
Depository as the Certificate Registrar may from time to time designate, and
shall bear such legend as may be appropriate.
(e) If the Trustee has instituted or has been directed to institute
any judicial proceeding in a court to enforce the rights of the
Certificateholders under the Certificates, and the Trustee has been advised by
counsel that in connection with such proceeding it is necessary or appropriate
for the Trustee to obtain possession of all or any portion of the Certificates
evidenced by Book-Entry Certificates, the Trustee may in its sole discretion
determine that such Certificates shall no longer be represented by such
Book-Entry Certificates. In such event, the Certificate Registrar will execute,
the Authenticating Agent will authenticate and the Certificate Registrar will
deliver, in exchange for such Book-Entry Certificates, Definitive Certificates
in a Denomination equal to the aggregate Denomination of such Book-Entry
Certificates to the party so requesting such Definitive Certificates. In such
event, the Trustee shall notify the affected Certificate Owners and make
appropriate arrangements for the effectuation of the purpose of this clause.
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(f) Upon acceptance for exchange or transfer of a beneficial interest
in a Book-Entry Certificate for a Definitive Certificate, as provided herein,
the Certificate Registrar shall endorse on a schedule affixed to the related
Book-Entry Certificate (or on a continuation of such schedule affixed to such
Book-Entry Certificate and made a part thereof) an appropriate notation
evidencing the date of such exchange or transfer and a decrease in the
Denomination of such Book-Entry Certificate equal to the Denomination of such
Definitive Certificate issued in exchange therefor or upon transfer thereof.
(g) If a Holder of a Definitive Certificate wishes at any time to
transfer such Certificate to a Person who wishes to take delivery thereof in
the form of a beneficial interest in the Book-Entry Certificate, such transfer
may be effected only in accordance with Depository Rules and this Section
5.03(g). Upon receipt by the Certificate Registrar at the Registrar Office of
(i) the Definitive Certificate to be transferred with an assignment and
transfer pursuant to Section 5.02(a), (ii) written instructions given in
accordance with Depository Rules directing the Certificate Registrar to credit
or cause to be credited to another account a beneficial interest in the related
Book-Entry Certificate, in an amount equal to the Denomination of the
Definitive Certificate to be so transferred, (iii) a written order given in
accordance with the Depository Rules containing information regarding the
account to be credited with such beneficial interest and (iv) if the affected
Certificate is a Non-Registered Certificate an Investment Representation Letter
from the transferee to the effect that such transferee is a Qualified
Institutional Buyer, the Certificate Registrar shall cancel such Definitive
Certificate, execute and deliver a new Definitive Certificate for the
Denomination of the Definitive Certificate not so transferred, registered in
the name of the Holder or the Holder's transferee (as instructed by the
Holder), and the Certificate Registrar shall instruct the Depository or the
custodian holding such Book-Entry Certificate on behalf of the Depository to
increase the Denomination of the related Book-Entry Certificate by the
Denomination of the Definitive Certificate to be so transferred, and to credit
or cause to be credited to the account of the Person specified in such
instructions a corresponding Denomination of such Book-Entry Certificate.
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction
of the destruction, loss or theft of any Certificate and (ii) there is
delivered to the Trustee and the Certificate Registrar such security or
indemnity as may be required by them to save each of them harmless, then, in
the absence of actual notice to the Trustee or the Certificate Registrar that
such Certificate has been acquired by a bona fide purchaser, the Certificate
Registrar shall execute, and the Authenticating Agent shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of the same Class and of like Percentage
Interest. Upon the issuance of any new Certificate under this Section, the
Trustee and the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee and the Certificate Registrar) connected therewith. Any replacement
Certificate issued pursuant to this Section shall constitute complete and
indefeasible evidence of ownership in the Trust Fund, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
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SECTION 5.05. Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of
transfer, the Depositor, the Servicer, the Special Servicer, the Trustee, the
Paying Agent, the Fiscal Agent, the Certificate Registrar and any agents of any
of them may treat the person in whose name such Certificate is registered as
the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 4.01 and for all other purposes whatsoever, except as and
to the extent provided in the definition of "Certificateholder," and none of
the Depositor, the Servicer, the Special Servicer, the Trustee, the Fiscal
Agent, the Paying Agent, the Certificate Registrar and any agent of any of them
shall be affected by notice to the contrary except as provided in Section
5.02(d).
SECTION 5.06. Appointment of Paying Agent.
___________________, _____________________________ is hereby initially
appointed Paying Agent to act on the Servicer's behalf in accordance with the
terms of this Agreement. If the Paying Agent resigns or is terminated, the
Trustee shall appoint a successor Paying Agent which may be the Trustee or an
Affiliate thereof.
[End of Article V]
ARTICLE VI.
THE DEPOSITOR, THE SERVICER
AND THE SPECIAL SERVICER
SECTION 6.01. Liability of the Depositor, the Servicer and the Special
Servicer.
The Depositor, the Servicer and the Special Servicer shall be liable
in accordance herewith only to the extent of the respective obligations
specifically imposed upon and undertaken by the Depositor, the Servicer and the
Special Servicer herein.
SECTION 6.02. Merger, Consolidation or Conversion of the Depositor, the
Servicer or the Special Servicer.
(a) Subject to subsection (b) below, the Depositor, the Servicer and
the Special Servicer each will keep in full effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation or organization, and each will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
(b) The Depositor, the Servicer and the Special Servicer each may be
merged or consolidated with or into any Person, or transfer all or
substantially all of its assets to any Person, in which case any Person
resulting from any merger or consolidation to which the
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Depositor, the Servicer or the Special Servicer shall be a party, or any Person
succeeding to the business of the Depositor, the Servicer or the Special
Servicer, shall be the successor of the Depositor, the Servicer and the Special
Servicer, as the case may be, hereunder, without the execution or filing of any
paper (other than an assumption agreement wherein the successor shall agree to
perform the obligations of and serve as the Depositor, the Servicer or the
Special Servicer, as the case may be, in accordance with the terms of this
Agreement) or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that such
merger, consolidation or succession will not result in a withdrawal,
downgrading or qualification of the then-current ratings of the Classes of
Certificates that have been so rated (as evidenced by a letter to such effect
from each Rating Agency).
SECTION 6.03. Limitation on Liability of the Depositor, the Servicer, the
Special Servicer and Others.
(a) Neither the Depositor, the Servicer (whether acting in such
capacity or as the Paying Agent, the Authenticating Agent or the Certificate
Registrar), the Special Servicer, the Extension Adviser nor any of the
directors, officers, employees or agents of any of the foregoing shall be under
any liability to the Trust or the Certificateholders for any action taken or
for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor, the Servicer, the Special Servicer, the
Extension Adviser or any such Person against any breach of warranties or
representations made herein or any liability which would otherwise be imposed
by reason of willful misfeasance, bad faith or negligence in the performance of
duties or by reason of negligent disregard of obligations and duties hereunder.
The Depositor, the Servicer, the Special Servicer, the Extension Adviser and
any director, officer, employee or agent of the Depositor, the Servicer, the
Special Servicer or the Extension Adviser may rely in good faith on any
document of any kind which, prima facie, is properly executed and submitted by
any Person respecting any matters arising hereunder. The Depositor, the
Servicer, the Special Servicer, the Extension Adviser and any director,
officer, employee or agent of any of the foregoing shall be indemnified and
held harmless by the Trust against any loss, liability or expense incurred in
connection with any legal action relating to this Agreement or the
Certificates, other than any loss, liability or expense: (i) specifically
required to be borne thereby pursuant to the terms hereof; (ii) incurred in
connection with any breach of a representation, warranty or covenant made by it
herein; (iii) incurred by reason of bad faith, willful misconduct or negligence
in the performance of its obligations or duties hereunder, or by reason of
negligent disregard of such obligations or duties or (iv) in the case of the
Depositor and any of its directors, officers, employees and agents, incurred in
connection with any violation by any of them of any state or federal securities
law.
(b) None of the Depositor, the Servicer (whether acting in such
capacity or as the Paying Agent, the Authenticating Agent or the Certificate
Registrar), the Special Servicer and the Extension Adviser shall be under any
obligation to appear in, prosecute or defend any legal or administrative
action, proceeding, hearing or examination that is not incidental to its
respective duties under this Agreement and which in its opinion may involve it
in any expense or liability; provided, however, that the Depositor, the
Servicer, the Special Servicer or the Extension Adviser may in its discretion
undertake any such action, proceeding, hearing or
121
examination that it may deem necessary or desirable in respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs
of such action, proceeding, hearing or examination and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor, the Servicer, the Special Servicer and the Extension Adviser shall
be entitled to be reimbursed therefor out of amounts attributable to the
Mortgage Loans on deposit in the Certificate Account as provided by Section
3.05(a).
(c) Each of the Servicer and the Special Servicer agrees to indemnify
the Depositor, the Trustee, the Fiscal Agent and the Trust and any director,
officer, employee or agent thereof, and hold them harmless, from and against
any and all claims, losses, penalties, fines, forfeitures, legal fees and
related costs, judgments, and any other costs, liabilities, fees and expenses
that any of them may sustain arising from or as a result of any willful
misfeasance, bad faith or negligence of the Servicer or the Special Servicer,
as the case may be, in the performance of its obligations and duties under this
Agreement (including acts or omissions occurring in their capacity as agent for
the Trustee) or by reason of reckless disregard by the Servicer or the Special
Servicer, as the case may be, of its duties and obligations hereunder or by
reason of breach of any representations or warranties made herein. The Trustee,
the Depositor or the Fiscal Agent, as the case may be, shall immediately notify
the Servicer or the Special Servicer, as applicable, if a claim is made by a
third party with respect to this Agreement or the Mortgage Loans entitling it
to indemnification hereunder, whereupon the Servicer or the Special Servicer,
as the case may be, shall assume the defense of such claim (with counsel
reasonably satisfactory to the Trustee, the Depositor or the Fiscal Agent) and
pay all expenses in connection therewith, including counsel fees, and promptly
pay, discharge and satisfy any judgment or decree which may be entered against
it or them in respect of such claim. Any failure to so notify the Servicer or
the Special Servicer, as the case may be, shall not affect any rights any of
the foregoing Persons may have to indemnification under this Agreement or
otherwise, unless the Servicer's, or the Special Servicer's, as the case may
be, defense of such claim is materially prejudiced thereby. The indemnification
provided herein shall survive the termination of this Agreement and the
termination or resignation of the Servicer, the Trustee, the Fiscal Agent and
the Special Servicer.
SECTION 6.04. Depositor, Servicer and Special Servicer Not to Resign.
Subject to the provisions of Section 6.02, none of the Depositor, the
Servicer and the Special Servicer shall resign from their respective
obligations and duties hereby imposed on each of them except upon (a)
determination that such party's duties hereunder are no longer permissible
under applicable law or (b) in the case of the Servicer, upon the appointment
of, and the acceptance of such appointment by, a successor Servicer and receipt
by the Trustee of written confirmation from each applicable Rating Agency that
such resignation and appointment will not cause such Rating Agency to
downgrade, withdraw or qualify any of the ratings assigned by such Rating
Agency to any Class of Certificates. Only the Servicer shall be permitted to
resign pursuant to clause (b) above. Any such determination permitting the
resignation of the Depositor, the Servicer or the Special Servicer pursuant to
clause (a) above shall be evidenced by an Opinion of Counsel (at the expense of
the resigning party) to such effect delivered to the Trustee. No such
resignation by the Servicer or the Special Servicer shall
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become effective until the Trustee or a successor Servicer shall have assumed
the Servicer's or Special Servicer's, as applicable, responsibilities and
obligations in accordance with Section 7.02.
SECTION 6.05. Rights of the Depositor in Respect of the Servicer and the
Special Servicer.
The Depositor may, but is not obligated to, enforce the obligations of
the Servicer and the Special Servicer hereunder and may, but is not obligated
to, perform, or cause a designee to perform, any defaulted obligation of the
Servicer and the Special Servicer hereunder or exercise the rights of the
Servicer or Special Servicer, as applicable, hereunder; provided, however, that
the Servicer and the Special Servicer shall not be relieved of any of their
respective obligations hereunder by virtue of such performance by the Depositor
or its designee. The Depositor shall not have any responsibility or liability
for any action or failure to act by the Servicer or the Special Servicer and is
not obligated to supervise the performance of the Servicer or the Special
Servicer under this Agreement or otherwise.
[End of Article VI]
ARTICLE VII.
DEFAULT
SECTION 7.01. Events of Default; Servicer and Special Servicer Termination.
(a) "Event of Default", wherever used herein, means any one of
the following events:
(i) any failure by the Servicer to make any remittance
required to be made by the Servicer to the Certificate Account, Escrow
Account or either Distribution Account on the day and by the time such
remittance is required to be made under the terms of this Agreement;
or
(ii) any failure by the Special Servicer to deposit into, or
to remit to the Servicer for deposit into, or the Servicer to make a
required deposit into the Certificate Account or the REO Account, or
to deposit into, or to remit to the Paying Agent for deposit into, the
Lower-Tier Distribution Account any amount required to be so deposited
or remitted by the Servicer or the Special Servicer, as the case may
be, pursuant to, and at the time specified by, the terms of this
Agreement; or
(iii) any failure on the part of the Servicer or the Special
Servicer duly to observe or perform in any material respect any other
of the covenants or agreements on the part of the Servicer or the
Special Servicer contained in this Agreement which continues
unremedied for a period of 30 days (15 days in the case of a failure
to pay the premium for any insurance policy required to be maintained
hereunder) after the date on which written notice of such failure,
requiring the same to be remedied, shall have been
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given to the Servicer or the Special Servicer, as the case may be, by
any other party hereto, or to the Servicer, the Special Servicer, the
Depositor and the Trustee by the Holders of Certificates of any Class
evidencing, as to such Class, Percentage Interests aggregating not
less than 25%; or
(iv) any breach on the part of the Servicer or the Special
Servicer of any representation or warranty contained in Section 3.23
or Section 3.24, as applicable, which materially and adversely affects
the interests of any Class of Certificateholders and which continues
unremedied for a period of 30 days after the date on which notice of
such breach, requiring the same to be remedied, shall have been given
to the Servicer or the Special Servicer, as the case may be, by the
Depositor or the Trustee, or to the Servicer, the Special Servicer,
the Depositor and the Trustee by the Holders of Certificates of any
Class evidencing, as to such Class, Percentage Interests aggregating
not less than 25%; or
(v) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency or
similar law for the appointment of a conservator, receiver,
liquidator, trustee or similar official in any bankruptcy, insolvency,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Servicer or the Special Servicer
and such decree or order shall have remained in force undischarged or
unstayed for a period of 60 days; or
(vi) the Servicer or the Special Servicer shall consent to
the appointment of a conservator, receiver, liquidator, trustee or
similar official in any bankruptcy, insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or
relating to the Servicer or the Special Servicer or of or relating to
all or substantially all of its property; or
(vii) the Servicer or the Special Servicer shall admit in
writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable bankruptcy,
insolvency or reorganization statute, make an assignment for the
benefit of its creditors, voluntarily suspend payment of its
obligations or take any corporate action in furtherance of the
foregoing; or
(viii) any Trustee shall have received written notice from
either Rating Agency that the continuation of the Servicer or Special
Servicer, as the case may be, has resulted, or would result, in and of
itself, in a downgrading, qualification or withdrawal of the
then-current rating on any Class of Certificates that are rated by a
Rating Agency if the Servicer or Special Servicer, as the case may be,
is not replaced.
(b) If any Event of Default with respect to the Servicer or the
Special Servicer (in either case, for purposes of this Section 7.01(b), the
"Defaulting Party") shall occur and be continuing, then, and in each and every
such case, so long as such Event of Default shall not have been remedied, the
Trustee may, and at the written direction of the Holders of Certificates
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entitled to at least 51% of the Voting Rights, shall, terminate, by notice in
writing to the Defaulting Party, with a copy of such notice to the Depositor,
all of the rights and obligations of the Defaulting Party under this Agreement
and in and to the Mortgage Loans and the proceeds thereof; provided, however,
that the Defaulting Party shall be entitled to the payment of accrued and
unpaid compensation and reimbursement through the date of such termination as
provided for under this Agreement for services rendered and expenses incurred.
From and after the receipt by the Defaulting Party of such written notice, all
authority and power of the Defaulting Party under this Agreement, whether with
respect to the Certificates (other than as a Holder of any Certificate) or the
Mortgage Loans or otherwise, shall pass to and be vested in the Trustee
pursuant to and under this Section, and, without limitation, the Trustee is
hereby authorized and empowered to execute and deliver, on behalf of and at the
expense of the Defaulting Party, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. The Servicer and
Special Servicer each agree that if it is terminated pursuant to this Section
7.01(b), it shall promptly (and in any event no later than 20 Business Days
subsequent to its receipt of the notice of termination) provide the Trustee
with all documents and records requested by it to enable it to assume the
Servicer's or the Special Servicer's, as the case may be, functions hereunder,
and shall cooperate with the Trustee in effecting the termination of the
Servicer's or the Special Servicer's, as the case may be, responsibilities and
rights hereunder, including, without limitation, the transfer within 5 Business
Days to the Trustee for administration by it of all cash amounts which shall at
the time be or should have been credited by the Servicer to the Certificate
Account or any Servicing Account (if it is the Defaulting Party) or by the
Special Servicer to the REO Account (if it is the Defaulting Party) or by the
Special Servicer to the REO Account (if it is the Defaulting Party) or
thereafter be received with respect to the Mortgage Loans or any REO Property;
provided, however, that the Servicer and the Special Servicer each shall, if
terminated pursuant to this Section 7.01(b), continue to be entitled to receive
all amounts accrued or owing to it under this Agreement on or prior to the date
of such termination, whether in respect of Advances (in the case of the
Servicer) or otherwise, and it and its directors, officers, employees and
agents shall continue to be entitled to the benefits of Section 6.03
notwithstanding any such termination.
(c) The Holder or Holders of more than 50% of the aggregate
Certificate Balance of the then Controlling Class shall be entitled to
terminate the rights and obligations of the Special Servicer under this
Agreement, with or without cause, upon 10 Business Days notice to the Special
Servicer, the Servicer and the Trustee, and to appoint a successor Special
Servicer; provided, however, that (i) such successor will meet the requirements
set forth in Section 7.02 and (ii) as evidenced in writing by each of the
Rating Agencies, the proposed successor of such Special Servicer will not, in
and of itself, result in a downgrading, withdrawal or qualification of the
then-current ratings provided by the Rating Agencies in respect to any Class of
then outstanding Certificates that is rated. No penalty or fee shall be payable
to the Special Servicer with respect to any termination pursuant to this
Section 7.01(c).
(d) The Servicer and Special Servicer shall, from time to time, take
all such actions as are required by them in order to maintain their respective
status as an approved servicer and
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special servicer, as applicable and as pertains to this transaction, with each
of the Rating Agencies.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Servicer or the Special Servicer, as the
case may be, either resigns pursuant to the first sentence of Section 6.04 or
receives a notice of termination for cause pursuant to Section 7.01(a), and
provided that no acceptable successor has been appointed, the Trustee shall be
the successor to the Servicer or Special Servicer, as the case may be, in all
respects in its capacity as Servicer or Special Servicer under this Agreement
and the transactions set forth or provided for herein and shall be subject to
all the responsibilities, duties, liabilities and limitations on liability
relating thereto and that arise thereafter placed on or for the benefit of the
Servicer or Special Servicer by the terms and provisions hereof; provided,
however, that any failure to perform such duties or responsibilities caused by
the terminated party's failure under Section 7.01 to provide information or
moneys required hereunder shall not be considered a default by such successor
hereunder. The appointment of a successor Servicer shall not affect any
liability of the predecessor Servicer which may have arisen prior to its
termination as Servicer, and the appointment of a successor Special Servicer
shall not affect any liability of the predecessor Special Servicer which may
have arisen prior to its termination as Special Servicer. The Trustee in its
capacity as successor to the Servicer or the Special Servicer, as the case may
be, shall not be liable for any of the representations and warranties of the
Servicer or the Special Servicer, respectively, herein or in any related
document or agreement, for any acts or omissions of the predecessor Servicer or
Special Servicer or for any losses incurred by the Servicer pursuant to Section
3.06 hereunder, nor shall the Trustee be required to purchase any Mortgage Loan
hereunder. As compensation therefor, the Trustee as successor Servicer shall be
entitled to the Servicing Fees and all fees relating to the Mortgage Loans
which the Servicer would have been entitled to if the Servicer had continued to
act hereunder, including but not limited to any income or other benefit from
any Permitted Investment pursuant to Section 3.06, and as successor to the
Special Servicer shall be entitled to the Special Servicing Fees to which the
Special Servicer would have been entitled if the Special Servicer had continued
to act hereunder. Should the Trustee succeed to the capacity of the Servicer or
the Special Servicer, the Trustee shall be afforded the same standard of care
and liability as the Servicer or the Special Servicer, as applicable, hereunder
notwithstanding anything in Section 8.01 to the contrary, but only with respect
to actions taken by it in its role as successor Servicer or successor Special
Servicer, as the case may be, and not with respect to its role as Trustee
hereunder. Notwithstanding the above, the Trustee may, if it shall be unwilling
to act as successor to the Servicer or Special Servicer, or shall, if it is
unable to so act, or if the Trustee is not approved as a servicer or special
servicer, as applicable, by each Rating Agency or if the Holders of
Certificates entitled to at least 51% of the Voting Rights so request in
writing to the Trustee, promptly appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution
which meets the criteria set forth herein, as the successor to the Servicer or
the Special Servicer, as applicable, hereunder in the assumption of all or any
part of the responsibilities, duties or liabilities of the Servicer or Special
Servicer hereunder. No appointment of a successor to the Servicer or the
Special Servicer hereunder shall be effective until the assumption in writing
by the successor to the Servicer or the Special Servicer of all its
responsibilities, duties and liabilities hereunder that arise thereafter.
Pending appointment of a
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successor to the Servicer or the Special Servicer hereunder, unless the Trustee
shall be prohibited by law from so acting, the Trustee shall act in such
capacity as herein above provided. In connection with such appointment and
assumption of a successor to the Servicer or Special Servicer as described
herein, the Trustee may make such arrangements for the compensation of such
successor out of payments on Mortgage Loans as it and such successor shall
agree; provided, however, that no such compensation with respect to a successor
Servicer or successor Special Servicer, as the case may be, shall be in excess
of that permitted the terminated Servicer or Special Servicer, as the case may
be, hereunder. The Trustee, the Servicer or the Special Servicer (whichever is
not the terminated party) and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
Any costs and expenses associated with the transfer of the servicing function
(other than with respect to a termination without cause) under this Agreement
shall be borne by the predecessor Servicer.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any resignation of the Servicer or the Special Servicer
pursuant to Section 6.04, any termination of the Servicer or the Special
Servicer pursuant to Section 7.01 or any appointment of a successor to the
Servicer or the Special Servicer pursuant to Section 7.02, the Trustee shall
give prompt written notice thereof to Certificateholders at their respective
addresses appearing in the Certificate Register.
(b) Not later than the later of (i) 60 days after the occurrence of
any event which constitutes or, with notice or lapse of time or both, would
constitute an Event of Default and (ii) 5 days after the Trustee would be
deemed to have notice of the occurrence of such an event in accordance with
Section 8.02(vii), the Trustee shall transmit by mail to the Depositor and all
Certificateholders notice of such occurrence, unless such default shall have
been cured.
SECTION 7.04. Waiver of Events of Default.
The Holders of Certificates representing at least 662/3% of the Voting
Rights allocated to each Class of Certificates affected by any Event of Default
hereunder may waive such Event of Default within 20 days of the receipt of
notice from the Trustee of the occurrence of such Event of Default; provided,
however, that an Event of Default under clause (i) of Section 7.01(a) may be
waived only by all of the Certificateholders of the affected Classes. Upon any
such waiver of an Event of Default, such Event of Default shall cease to exist
and shall be deemed to have been remedied for every purpose hereunder. No such
waiver shall extend to any subsequent or other Event of Default or impair any
right consequent thereon except to the extent expressly so waived.
Notwithstanding any other provisions of this Agreement, for purposes of waiving
any Event of Default pursuant to this Section 7.04, Certificates registered in
the name of the Depositor or any Affiliate of the Depositor shall be entitled
to the same Voting Rights with respect to the matters described above as they
would if any other Person held such Certificates.
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SECTION 7.05. Trustee and Fiscal Agent as Makers of Advances.
(a) In the event that the Servicer fails to fulfill its obligations
hereunder to make any Advances, the Trustee shall immediately notify the Fiscal
Agent of such circumstances in writing, and the Trustee shall perform such
obligations (x) within one Business Day of such failure by the Servicer with
respect to Servicing Advances to the extent the Trustee has actual knowledge of
such failure with respect to such Servicing Advances and (y) by the close of
business, New York City time, on the related P&I Advance Date with respect to
P&I Advances. With respect to any such Advance made by the Trustee, the Trustee
shall succeed to all of the Servicer's rights with respect to Advances
hereunder, including, without limitation, the Servicer's rights of
reimbursement and interest on each Advance at the Reimbursement Rate, and
rights to determine that a proposed Advance is a Nonrecoverable P&I Advance or
Servicing Advance, as the case may be, (without regard to any impairment of any
such rights of reimbursement caused by such Servicer's default in its
obligations hereunder); provided, however, that if Advances made by both the
Trustee and the Servicer shall at any time be outstanding, or any interest on
any Advance shall be accrued and unpaid, all amounts available to repay such
Advances and the interest thereon hereunder shall be applied entirely to the
Advances outstanding to the Trustee, until such Advances shall have been repaid
in full, together with all interest accrued thereon, prior to reimbursement of
the Servicer for such Advances. The Trustee shall be entitled to conclusively
rely on any notice given with respect to a Nonrecoverable Advance hereunder. In
the event the Fiscal Agent is not the initial Fiscal Agent, with respect to any
Distribution Date that the Trustee is required to make any P&I Advances,
immediately upon making such P&I Advances the Trustee shall notify the Fiscal
Agent by facsimile that such P&I Advances have been made.
(b) In the event that the Trustee fails to fulfill its obligations
hereunder to make any Advances following the failure of the Servicer to make an
Advance, the Fiscal Agent shall perform such obligations (x) within one
Business Day of such failure by the Trustee with respect to Servicing Advances
and (y) by no later than 10:00 a.m., New York City time, on the related
Distribution Date with respect to P&I Advances, and, with respect to any such
Advance made by the Fiscal Agent, the Fiscal Agent shall succeed to all of the
Trustee's rights with respect to any such Advance hereunder; provided, however,
that if Advances made by the Servicer, the Trustee and the Fiscal Agent shall
at any time be outstanding, or any interest on any Advance shall be accrued and
unpaid, all amounts available to repay such Advances and interest hereunder
shall be applied entirely to the Advances outstanding to the Fiscal Agent,
until such Advances shall have been repaid in full, together with all interest
accrued thereon. The Fiscal Agent shall be entitled to conclusively rely on any
notice given with respect to a Nonrecoverable Advance hereunder.
[End of Article VII]
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ARTICLE VIII.
CONCERNING THE TRUSTEE AND FISCAL AGENT
SECTION 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing or waiving of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs. Any permissive right of the Trustee contained in this Agreement
shall not be construed as a duty.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement (other than the Mortgage Files, the review of which
is specifically governed by the terms of Article II), shall examine them to
determine whether they conform to the requirements of this Agreement. If any
such instrument is found not to conform to the requirements of this Agreement
in a material manner, the Trustee shall take such action as it deems
appropriate to have the instrument corrected. The Trustee shall not be
responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by
the Depositor, the Servicer or the Special Servicer, and accepted by the
Trustee in good faith, pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after
the curing of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by
the express provisions of this Agreement, the Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and,
in the absence of bad faith on the part of the Trustee, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the Trustee and conforming to the
requirements of this Agreement;
(ii) The Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) The Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of
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Holders of Certificates entitled to at least 25% of the Voting Rights
relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Agreement (unless a
higher percentage of Voting Rights is required for such action).
SECTION 8.02. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(i) The Trustee may rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's
Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent,
order, Appraisal, bond or other paper or document reasonably believed
by it to be genuine and to have been signed or presented by the proper
party or parties;
(ii) The Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken
or suffered or omitted by it hereunder in good faith and in accordance
therewith;
(iii) The Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by this Agreement or to make
any investigation of matters arising hereunder or to institute,
conduct or defend any litigation hereunder or in relation hereto at
the request, order or direction of any of the Certificateholders,
pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; the Trustee shall not be
required to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably
assured to it; nothing contained herein shall, however, relieve the
Trustee of the obligation, upon the occurrence of an Event of Default
which has not been cured, to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care and
skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;
(iv) The Trustee shall not be personally liable for any
action reasonably taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Agreement;
(v) Prior to the occurrence of an Event of Default hereunder
and after the curing of all Events of Default which may have occurred,
the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing
to do so by Holders of
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Certificates entitled to at least 50% of the Voting Rights; provided,
however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee,
not reasonably assured to the Trustee by the security afforded to it
by the terms of this Agreement, the Trustee may require reasonable
indemnity against such expense or liability as a condition to taking
any such action. The reasonable expense of every such reasonable
examination shall be paid by the Servicer or, if paid by the Trustee,
shall be repaid by the Servicer upon demand;
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys; provided, however, that the appointment
of such agents or attorneys shall not relieve the Trustee of its
duties or obligations hereunder;
(vii) For all purposes under this Agreement, the Trustee
shall not be deemed to have notice of any Event of Default unless a
Responsible Officer of the Trustee has actual knowledge thereof or
unless written notice of any event which is in fact such a default is
received by the Trustee at the Corporate Trust Office, and such notice
references the Certificates or this Agreement; and
(viii) The Trustee shall not be responsible for any act or
omission of the Servicer, the Special Servicer or the Extension
Adviser (unless the Trustee is acting as Servicer, Special Servicer or
the Extension Adviser, as the case may be) or of the Depositor.
SECTION 8.03. Trustee and Fiscal Agent Not Liable for Validity or Sufficiency
of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates, other than the
acknowledgments of the Trustee in Sections 2.02 and 2.04 and the signature, if
any, of the Trustee set forth on any outstanding Certificate, shall be taken as
the statements of the Depositor, the Servicer or the Special Servicer, as the
case may be, and the Trustee assumes no responsibility for their correctness.
Neither the Trustee nor the Fiscal Agent makes any representations as to the
validity or sufficiency of this Agreement or of any Certificate (other than as
to the signature, if any, of the Trustee sat forth thereon) or of any Mortgage
Loan or related document. Neither the Trustee nor the Fiscal Agent shall be
accountable for the use or application by the Depositor of any of the
Certificates issued to it or of the proceeds of such Certificates, or for the
use or application of any funds paid to the Depositor in respect of the
assignment of the Mortgage Loans to the Trust Fund, or any funds deposited in
or withdrawn from the Certificate Account or any other account by or on behalf
of the Depositor, the Servicer, the Special Servicer, the Extension Adviser or
the Paying Agent (unless the Trustee or the Fiscal Agent is acting as Paying
Agent). Neither the Trustee nor the Fiscal Agent shall be responsible for the
accuracy or content of any resolution, certificate, statement, opinion, report,
document, order or other instrument furnished by the Depositor, the Servicer,
the Special Servicer or the Extension Adviser, and accepted by the Trustee or
the Fiscal Agent, as applicable, in good faith, pursuant to this Agreement.
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SECTION 8.04. Trustee and Fiscal Agent May Own Certificates.
Each of the Trustee and the Fiscal Agent in its individual capacity,
not as Trustee or Fiscal Agent, may become the owner or pledge of Certificates,
and may deal with the Depositor, the Servicer, the Special Servicer, the
Placement Agents and the Underwriters in banking transactions, with the same
rights it would have if it were not Trustee or the Fiscal Agent, as applicable.
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of Trustee and
Fiscal Agent.
(a) As compensation for the performance of its duties, the Trustee
will be paid the Trustee Fee, equal to one month's interest at the Trustee Fee
Rate, which shall cover recurring and otherwise reasonably anticipated expenses
of the Trustee (including in the Trustee's capacity as the initial Extension
Adviser). The Trustee Fee shall be paid monthly on a Mortgage Loan-by-Mortgage
Loan basis. As to each Mortgage Loan and REO Loan, the Trustee Fee shall accrue
from time to time at the Trustee Fee Rate and shall be computed on the basis of
the Stated Principal Balance of such Mortgage Loan and for the same period of
time which any interest payment due on such Mortgage Loan or deemed due on such
REO Loan is computed. The Trustee Fee (which shall not be limited to any
provision of law in regard to the compensation of a trustee of an express
trust) shall constitute the Trustee's sole form of compensation for all
services rendered by it in the execution of the trusts hereby created and in
the exercise and performance of any of the powers and duties of the Trustee
hereunder. The Trustee shall pay, at its own expense, the fees and expenses of
the Fiscal Agent.
(b) The Trustee, the Fiscal Agent and any director, officer, employee
or agent of the Trustee or the Fiscal Agent shall be entitled to be indemnified
and held harmless by the Trust Fund (to the extent of amounts on deposit in the
Lower-Tier Distribution Account from time to time) against any loss, liability
or expense (including, without limitation, costs and expenses of litigation,
and of investigation, counsel fees, damages, judgments and amounts paid in
settlement, and expenses incurred in becoming successor servicer, to the extent
not otherwise paid hereunder) arising out of, or incurred in connection with,
any act or omission of the Trustee or the Fiscal Agent, as applicable, relating
to the exercise and performance of any of the powers and duties of the Trustee
or the Fiscal Agent, as applicable, hereunder; provided, however, that neither
the Trustee, the Fiscal Agent nor any of the other above specified Persons
shall be entitled to indemnification pursuant to this Section 8.05(b) for (i)
allocable overhead, (ii) expenses or disbursements incurred or made by or on
behalf of the Trustee or the Fiscal Agent, as applicable, in the normal course
of the Trustee's performing its duties in accordance with any of the provisions
hereof, which are not "unanticipated expenses of the REMIC" within the meaning
of Treasury Regulations Section 1.860G-l(b)(3)(ii), (iii) any expense or
liability specifically required to be borne thereby pursuant to the terms
hereof or (iv) any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of the Trustee's or the
Fiscal Agent's obligations and duties hereunder, or by reason of negligent
disregard of such obligations or duties, or as may arise from a breach of any
representation, warranty or covenant of the Trustee or the Fiscal Agent made
herein. The provisions of this
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Section 8.05(b) shall survive any resignation or removal of the Trustee and/or
Fiscal Agent and appointment of a successor thereto.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be, and will be required to
resign if it fails to be, (i) a corporation, national bank or national banking
association, organized and doing business under the laws of any state or the
United States of America, authorized under such laws to exercise corporate
trust powers and to accept the trust conferred under this Agreement, having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by federal or state authority and shall not be an Affiliate of
the Servicer or the Special Servicer (except during any period when the Trustee
is acting as, or has become successor to, the Servicer or the Special Servicer,
as the case may be, pursuant to Section 7.02), (ii) an institution insured by
the Federal Deposit Insurance Corporation and (iii) an institution whose
long-term senior unsecured debt is rated either (a) if a Fiscal Agent is then
currently in place, not less than (1) "BBB" by __________ and (2) "BBB" by
__________ (provided that the Fiscal Agent is not an entity that in and of
itself would result in the downgrading, withdrawal or qualification of
__________'s rating of any of the then-rated Certificates) or (b) if a Fiscal
Agent is not then in place, "AA" by each Rating Agency (or such entity as would
not, as evidenced in writing by such Rating Agency, result in the
qualification, downgrading or withdrawal of any of the ratings then assigned
thereby to the Certificates).
If such corporation, national bank or national banking association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section the combined capital and surplus of such corporation,
national bank or national banking association shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. In the event the place of business from which the
Trustee administers the Upper-Tier REMIC and the Lower-Tier REMIC is in a state
or local jurisdiction that imposes a tax on the Trust Fund on the net income of
a REMIC (other than a tax corresponding to a tax imposed under the REMIC
Provisions), the Trustee shall elect either to (i) resign immediately in the
manner and with the effect specified in Section 8.07, (ii) pay such tax at no
expense to the Trust or (iii) administer the Upper-Tier REMIC and the
Lower-Tier REMIC from a state and local jurisdiction that does not impose such
a tax.
SECTION 8.07. Resignation and Removal of the Trustee and the Fiscal Agent.
(a) The Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Depositor, the
Servicer, the Special Servicer and to all Certificateholders. Upon receiving
such notice of resignation, the Depositor shall promptly appoint a successor
trustee acceptable to the Servicer by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee and to the successor
trustee. A copy of such instrument shall be delivered to the Servicer, the
Special Servicer and the Certificateholders by the Depositor. If no successor
trustee shall have been so appointed and have accepted appointment within 30
days after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
trustee.
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(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Depositor or the Servicer, or if at any time
the Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Trustee and appoint a successor
trustee acceptable to the Servicer by written instrument, in duplicate, which
instrument shall be delivered to the Trustee so removed and to the successor
trustee. A copy of such instrument shall be delivered to the Servicer, the
Special Servicer and the Certificateholders by the Depositor.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which instruments
shall be delivered to the Servicer, one complete set to the Trustee so removed
and one complete set to the successor so appointed. A copy of such instrument
shall be delivered to the Depositor, the Special Servicer and the remaining
Certificateholders by the Servicer.
(d) Subject to the last sentence of the last paragraph of this Section
8.07(d), the Fiscal Agent shall not be entitled to resign, except under a
determination that it may no longer perform its obligations and duties under
applicable law or such obligations and duties are in material conflict by
reason of applicable law with any other activities carried on by it. Any such
determination is required to be evidenced by an Opinion of Counsel to such
effect delivered to the Depositor and the Trustee. The Fiscal Agent may also
resign from its obligations and duties under this Agreement at any time upon
reasonable notice to the Trustee, provided that (i) a successor fiscal agent is
willing to assume the obligations, responsibilities, and covenants to be
performed by the Fiscal Agent on substantially the same terms and conditions,
and for not more than equivalent compensation, (ii) the Fiscal Agent bears all
costs associated with such resignation, (iii) the successor fiscal agent has a
long-term debt rating of at least "AA" from each Rating Agency or, as confirmed
in writing by each Rating Agency, is an entity that in and of itself would not
result in a downgrading, withdrawal or qualification of any rating of any
then-rated Certificate, (iv) the successor fiscal agent is approved by the
Depositor and the Trustee and (v) the Rating Agencies shall have confirmed in
writing that the appointment of such successor fiscal agent will not adversely
affect or result in a withdrawal, downgrading, or qualification of the ratings
on the Certificates that are then-rated.
Upon any resignation or removal of the Fiscal Agent, the Trustee will
be required to designate a successor Fiscal Agent whose appointment will not
adversely affect the ratings on the Certificates then rated, unless (i) there
is a successor Fiscal Agent already provided for in accordance with the proviso
to the last sentence of the preceding paragraph in this Section 8.07(d) or (ii)
the long-term senior unsecured debt of the Trustee is rated "AA" by each Rating
Agency (or such other rating by either Rating Agency as would not, as evidenced
in writing by such Rating Agency, Adversely affect any of the ratings then
assigned thereby to the Certificates).
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Any resignation or removal of the Trustee and the Fiscal Agent and
appointment of a successor Trustee and Fiscal Agent pursuant to any of the
provisions of this Section 8.07 shall not become effective until acceptance of
appointment by the successor Trustee and Fiscal Agent as provided in Section
8.08, except that the resignation or removal of the Fiscal Agent shall become
effective immediately if, at the time of such resignation or removal, the
long-term senior unsecured debt of the Trustee is rated "AA" by each Rating
Agency (or such other rating by either Rating Agency as would not, as evidenced
in writing by such Rating Agency, adversely affect any of the ratings then
assigned thereby to the Certificates).
Upon any succession of the Trustee under this Agreement, the
predecessor Trustee shall be entitled to the payment of accrued and unpaid
compensation and reimbursement as provided for under this Agreement for
services rendered and expenses incurred. No Trustee or Fiscal Agent shall be
personally liable for any action or omission of any successor Trustee or
successor Fiscal Agent. Notwithstanding anything to the contrary herein,
resignation or removal of the initial Trustee shall automatically result in the
simultaneous resignation or removal of the initial Fiscal Agent.
SECTION 8.08. Successor Trustee and Fiscal Agent.
(a) Any successor Trustee or Fiscal Agent appointed as provided in
Section 8.07 shall execute, acknowledge and deliver to the Depositor, the
Servicer, the Special Servicer and to its predecessor Trustee or Fiscal Agent,
as applicable, an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee or Fiscal
Agent, as applicable, shall become effective and such successor Trustee or
Fiscal Agent, as applicable, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as Trustee
or Fiscal Agent herein. The predecessor Trustee shall deliver to the successor
trustee all Mortgage Files and related documents and statements held by it
hereunder (other than any Mortgage Files at the time held on its behalf by a
Custodian, which Custodian shall become the agent of the successor Trustee),
and the Depositor, the Servicer, the Special Servicer and the predecessor
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required to more fully and certainly vest and confirm in the
successor Trustee all such rights, powers, duties and obligations, and to
enable the successor Trustee to perform its obligations hereunder.
(b) No successor Trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor Trustee or Fiscal
Agent as provided in this Section 8.08, the Servicer shall mail notice of the
succession of such Trustee or Fiscal Agent hereunder to the Depositor and the
Certificateholders. If the Servicer fails to mail such notice within 10 days
after acceptance of appointment by the successor Trustee or Fiscal Agent, such
successor Trustee or Fiscal Agent, as applicable, shall cause such notice to be
mailed at the expense of the Servicer.
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SECTION 8.09. Merger or Consolidation of Trustee or Fiscal Agent.
Any Person into which the Trustee or the Fiscal Agent may be merged or
converted or with which it may be consolidated or any Person resulting from any
merger, conversion or consolidation to which the Trustee or the Fiscal Agent
shall be a party, or any Person succeeding to all or substantially all of the
corporate trust business of the Trustee or the Fiscal Agent, shall be the
successor of the Trustee or the Fiscal Agent, respectively, hereunder;
provided, that, in the case of the Trustee, such successor Person shall be
eligible under the provisions of Section 8.06, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding. The Trustee or the Fiscal
Agent, as the case may be, will provide notice of such event to the Servicer,
the Special Servicer, the Depositor and the Rating Agencies.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund,
and to vest in such Person or Persons, in such capacity, such title to the
Trust Fund, or any part thereof, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider necessary or desirable. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by
it of a request to do so, or in case an Event of Default shall have occurred
and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 8.06
hereunder and no notice to Holders of Certificates of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 8.08
hereof.
(b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Servicer or the Special Servicer hereunder), the Trustee
shall be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of title to
the Trust Fund or any portion thereof in any such jurisdiction) shall be
exercised and performed by such separate trustee or co-trustee at the direction
of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then-separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in
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its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the
conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute
the Trustee, its agent or attorney-in-fact, with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
(e) The appointment of a co-trustee or separate trustee under this
Section 8.10 shall not relieve the Trustee of its duties and responsibilities
hereunder.
SECTION 8.11. Appointment of Custodians.
The Trustee may, with the consent of the Servicer, appoint one or more
Custodians to hold all or a portion of the Mortgage Files as agent for the
Trustee. Each Custodian shall be a depository institution subject to
supervision by federal or state authority, shall have combined capital and
surplus of at least $15,000,000 and shall be qualified to do business in the
jurisdiction in which it holds any Mortgage File and shall not be the Depositor
or any Affiliate of the Depositor. Each Custodian shall be subject to the same
obligations and standard of care as would be imposed on the Trustee hereunder
in connection with the retention of Mortgage Files directly by the Trustee. The
appointment of one or more Custodians shall not relieve the Trustee from any of
its obligations hereunder, and the Trustee shall remain responsible for all
acts and omissions of any Custodian. Any Custodian appointed hereunder must
maintain a fidelity bond and errors and omissions policy in an amount customary
for Custodians which serve in such capacity in commercial mortgage loan
securitization transactions.
SECTION 8.12. Access to Certain Information.
(a) On or prior to the date of the first sale of any Non-Registered
Certificate to an Independent third party, the Depositor shall provide to the
Trustee a copy of any private placement memorandum or other disclosure document
used by the Depositor or its Affiliate in connection with the offer and sale of
the Class of Certificates to which such Non-Registered Certificate relates. In
addition, if any such private placement memorandum or disclosure document is
revised, amended or supplemented at any time following the delivery thereof to
the Trustee and the Paying Agent, the Depositor promptly shall inform the
Trustee of such event and shall deliver to the Trustee a copy of the private
placement memorandum or disclosure document, as revised, amended or
supplemented. The Paying Agent (or with respect to item (ii)(j) below, the
Trustee) shall maintain at its offices primarily responsible for administering
the Trust Fund and shall, upon reasonable advance notice, make available during
normal business hours for review by any Holder of a Certificate, the Depositor,
the Servicer, the Special Servicer, the Extension Adviser, any Rating Agency or
any other Person to whom the Paying Agent believes such disclosure is
appropriate, originals or copies of the following items: (i) in
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the case of a Holder or prospective transferee of a Non-Registered Certificate,
any private placement memorandum or other disclosure document relating to the
Class of Certificates to which such Non-Registered Certificate belongs, in the
form most recently provided to the Paying Agent and (ii) in all cases, (a) this
Agreement and any amendments hereto entered into pursuant to Section 11.01, (b)
all statements required to be delivered to Certificateholders of the relevant
Class pursuant to Section 4.02 since the Closing Date, (c) all Officer's
Certificates delivered to the Paying Agent since the Closing Date pursuant to
Section 3.13, (d) all accountants' reports delivered to the Paying Agent since
the Closing Date pursuant to Section 3.14, (e) any inspection report prepared
by the Servicer, Sub-Servicer or Special Servicer, as applicable, and delivered
to the Paying Agent and Servicer in respect of each Mortgaged Property pursuant
to Section 3.12(a), (f) as to each Mortgage Loan pursuant to which the related
Mortgagor is required to deliver such items or the Special Servicer has
otherwise acquired such items, the most recent annual operating statement and
rent roll of the related Mortgaged Property and financial statements of the
related Mortgagor and any other reports of the Mortgagor collected by the
Servicer, Sub-Servicer or Special Servicer, as applicable, and delivered to the
Paying Agent pursuant to Section 3.12(b), together with the accompanying
written reports to be prepared by the Special Servicer and delivered to the
Paying Agent pursuant to Section 3.12(b), (g) any and all notices, reports and
Environmental Assessments delivered to the Paying Agent with respect to any
Mortgaged Property securing a Defaulted Mortgage Loan as to which the
environmental testing contemplated by Section 3.09(c) revealed that either of
the conditions set forth in clauses (i) and (ii) of the first sentence thereof
was not satisfied (but only for so long as such Mortgaged Property or the
related Mortgage Loan are part of the Trust Fund), (h) any and all
modifications, waivers and amendments of the terms of a Mortgage Loan entered
into by the Servicer or the Special Servicer and delivered to the Paying Agent
pursuant to Section 3.20 (but only for so long as the affected Mortgage Loan is
part of the Trust Fund), (i) any and all Officer's Certificates delivered to
the Paying Agent to support the Servicer's determination that any P&I Advance
or Servicing Advance was or, if made, would be a Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance, as the case may be, (j) any and all of the
Mortgage Loan documents contained in the Mortgage File, (k) any and all
Appraisals obtained pursuant to the definition of "Appraisal Reduction" herein,
(l) information regarding the occurrence of Servicing Transfer Events as to the
Mortgage Loans and (m) any and all Sub-Servicing Agreements and any amendments
thereto and modifications thereof. Copies of any and all of the foregoing items
will be available from the Paying Agent upon request; provided, however, that
the Paying Agent shall be permitted to require payment of a sum sufficient to
cover the reasonable costs and expenses of providing such copies, except in the
case of copies provided to the Rating Agencies, which shall be free of charge.
In addition, without limiting the generality of the foregoing, any Class [F],
Class [G] and Class [H] Certificateholder may upon request from the Paying
Agent obtain a copy of any factual report (other than the Asset Status Report)
delivered to the Rating Agencies under this Agreement.
(b) The Servicer shall provide a financial market publisher, which
initially shall be Bloomberg, L.P., on a quarterly basis, current information
regarding the items listed on Schedule 1 hereto with respect to the Mortgaged
Properties, to the extent such information due from Mortgagors has been
received from the Mortgagors. If any such information is provided on or before
____________, 1998, the Servicer shall provide the Prospectus to Bloomberg,
L.P.
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(c) Notwithstanding anything to the contrary herein, in addition to
the reports and information made available and distributed pursuant to the
terms of this Agreement, the Servicer and the Paying Agent shall, in accordance
with such reasonable rules and procedures as each may adopt (which may include
the requirement that an agreement that provides that such information shall be
used solely for purposes of evaluating the investment characteristics of the
Certificates be executed), also provide the reports available to
Certificateholders pursuant to Section 4.02, as well as certain additional
information received by the Servicer or the Paying Agent, as the case may be,
to any Certificateholder, the Underwriters, the Placement Agents, any
Certificate Owner or any prospective investor identified as such by a
Certificate Owner or Underwriter, that requests such reports or information;
provided that the Servicer or the Paying Agent, as the case may be, shall be
permitted to require payment of a sum sufficient to cover the reasonable costs
and expenses of providing copies of such reports or information.
(d) With respect to any information furnished by the Paying Agent or
the Servicer pursuant to this Section 8.12, the Paying Agent or Servicer, as
the case may be, shall be entitled to indicate the source of such information
and the Paying Agent or Servicer, as applicable, may affix thereto any
disclaimer it deems appropriate in its discretion. The Paying Agent or the
Servicer, as applicable, shall notify Certificateholders of the availability of
any such information in any manner as it, in its sole discretion, may
determine. In connection with providing access to or copies of the items
described in the preceding paragraph, the Paying Agent or the Servicer, as the
case may be, may require (a) in the case of Certificate Owners, a confirmation
executed by the requesting Person substantially in form and substance
reasonably acceptable to the Servicer or Paying Agent, as applicable, generally
to the effect that such Person is a beneficial holder of Certificates, is
requesting the information solely for use in evaluating such Person's
investment in the Certificates and will otherwise keep such information
confidential and (b) in the case of a prospective purchaser, confirmation
executed by the requesting Person in form and substance reasonably acceptable
to the Paying Agent or the Servicer, as the case may be, generally to the
effect that such Person is a prospective purchaser of a Certificate or an
interest therein, is requesting the information solely for use in evaluating a
possible investment in Certificates and will otherwise keep such information
confidential. Neither the Servicer nor the Paying Agent shall be liable for the
dissemination of information in accordance with this Agreement.
SECTION 8.13. Representations and Warranties of the Trustee and the Fiscal
Agent.
(a) The Trustee hereby represents and warrants to the Depositor, the
Servicer and the Special Servicer and for the benefit of the
Certificateholders, as of the Closing Date, that:
(i) The Trustee is a national banking association, duly
organized, validly existing and in good standing under the laws of the
United States;
(ii) The execution and delivery of this Agreement by the
Trustee, and the performance and compliance with the terms of this
Agreement by the Trustee, will not violate the Trustee's charter and
by-laws or constitute a default (or an event which, with notice or
lapse of time, or both, would constitute a default) under, or result
in the breach
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of, any material agreement or other instrument to which it is a party
or which is applicable to it or any of its assets;
(iii) The Trustee has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement;
(iv) This Agreement, assuming due authorization, execution
and delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Trustee, enforceable against the
Trustee in accordance with the terms hereof, subject to (a) applicable
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights generally and the
rights of creditors of national banking associations specifically and
(b) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law;
(v) The Trustee is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the
terms of this Agreement will not constitute a violation of, any law,
any order or decree of any court or arbiter, or any order, regulation
or demand of any federal, state or local governmental or regulatory
authority, which violation, in the Trustee's good faith and reasonable
judgment, is likely to affect materially and adversely either the
ability of the Trustee to perform its obligations under this Agreement
or the financial condition of the Trustee;
(vi) No litigation is pending or, to the best of the
Trustee's knowledge, threatened against the Trustee which would
prohibit the Trustee from entering into this Agreement or, in the
Trustee's good faith and reasonable judgment, is likely to materially
and adversely affect either the ability of the Trustee to perform its
obligations under this Agreement or the financial condition of the
Trustee; and
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Trustee, or compliance by the Trustee
with, this Agreement or the consummation of the transactions
contemplated by this Agreement, except for any consent, approval,
authorization or order which has not been obtained or cannot be
obtained prior to the actual performance by the Trustee of its
obligations under this Agreement, and which, if not obtained would not
have a materially adverse effect on the ability of the Trustee to
perform its obligations hereunder.
(b) The Fiscal Agent hereby represents and warrants to the Depositor,
the Servicer and the Special Servicer and for the benefit of the
Certificateholders, as of the Closing Date, that:
(i) The Fiscal Agent is a foreign banking corporation, duly
organized, validly existing and in good standing under the laws
governing its creation;
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(ii) The execution and delivery of this Agreement by the
Fiscal Agent, and the performance and compliance with the terms of
this Agreement by the Fiscal Agent, will not violate the Fiscal
Agent's charter and by-laws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a
default) under, or result in the breach of, any material agreement or
other instrument to which it is a party or which is applicable to it
or any of its assets;
(iii) The Fiscal Agent has the full power and authority to
enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and performance
of this Agreement, and has duly executed and delivered this Agreement;
(iv) This Agreement, assuming due authorization, execution
and delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Fiscal Agent, enforceable against
the Fiscal Agent in accordance with the terms hereof, subject to (a)
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights generally
and the rights of creditors of national banking associations
specifically and (b) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at
law;
(v) The Fiscal Agent is not in violation of, and its
execution and delivery of this Agreement and its performance and
compliance with the terms of this Agreement will not constitute a
violation of, any law, any order or decree of any court or arbiter, or
any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Fiscal
Agent's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the Fiscal Agent to
perform its obligations under this Agreement or the financial
condition of the Fiscal Agent;
(vi) No litigation is pending or, to the best of the Fiscal
Agent's knowledge, threatened against the Fiscal Agent which would
prohibit the Fiscal Agent from entering into this Agreement or, in the
Fiscal Agent's good faith and reasonable judgment, is likely to
materially and adversely affect either the ability of the Fiscal Agent
to perform its obligations under this Agreement or the financial
condition of the Fiscal Agent; and
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Fiscal Agent, or compliance by the
Fiscal Agent with, this Agreement or the consummation of the
transactions contemplated by this Agreement, except for any consent,
approval, authorization or order which has not been obtained or cannot
be obtained prior to the actual performance by the Fiscal Agent of its
obligations under this Agreement, and which, if not obtained would not
have a materially adverse effect on the ability of the Fiscal Agent to
perform its obligations hereunder.
[End of Article VIII]
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ARTICLE IX.
TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All Mortgage
Loans.
Subject to Section 9.02, the Trust Fund and the respective obligations
and responsibilities under this Agreement of the Depositor, the Servicer, the
Special Servicer and the Trustee (other than the obligations of the Trustee to
provide for and make payments to Certificateholders as hereafter set forth)
shall terminate upon payment (or provision for payment) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required hereunder to be so paid on the Distribution Date following the earlier
to occur of (i) the purchase by the Servicer, the Special Servicer, the Holders
of the Controlling Class or the Holders of the Class [LR] Certificates of all
the Mortgage Loans and each REO Property remaining in the Trust Fund at a price
equal to (a) the sum of (1) the aggregate Purchase Price of all the Mortgage
Loans (exclusive of REO Loans) included in the Trust Fund and (2) the Appraised
Value of each REO Property, if any, included in the Trust Fund (such Appraisals
in clause (a)(2) to be conducted by an Independent MAI-designated appraiser
selected and mutually agreed upon by the Servicer and the Trustee, and approved
by more than 50% of the Voting Rights of the Classes of Certificates then
outstanding (other than the Controlling Class unless the Controlling Class is
the only Class of Certificates then outstanding)), minus (b) solely in the case
where the Servicer is effecting such purchase, the aggregate amount of
unreimbursed Advances, together with any interest accrued and payable to the
Servicer in respect of such Advances in accordance with Sections 3.03(d) and
4.03(d) and any unpaid Servicing Fees, remaining outstanding (which items shall
be deemed to have been paid or reimbursed to the Servicer in connection with
such purchase) and (ii) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in
the Trust Fund; provided, however, that in no event shall the trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador of the
United States to the Court of St. James's, living on the date hereof.
The Servicer, the Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates may, at its option, elect
to purchase all of the Mortgage Loans and each REO Property remaining in the
Trust Fund as contemplated by clause (i) of the preceding paragraph by giving
written notice to the Trustee, the Paying Agent and the other parties hereto no
later than 60 days prior to the anticipated date of purchase; provided,
however, that the Servicer, the Special Servicer, the Holders of the
Controlling Class or the Holders of the Class [LR] Certificates may so elect to
purchase all of the Mortgage Loans and each REO Property remaining in the Trust
Fund only on or after the first Distribution Date on which the aggregate Stated
Principal Balances of the Mortgage Loans and any REO Loans remaining in the
Trust Fund is less than 4% of the aggregate Cut-off Date Principal Balance of
the Mortgage Loans set forth in the Preliminary Statement. In the event that
the Servicer, the Special Servicer, the Holders of the Controlling Class or the
Holders of the Class [LR] Certificates purchases all of the Mortgage Loans and
each REO Property remaining in the Trust Fund in accordance with the preceding
sentence, the Servicer, the Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates, as applicable, shall
deposit in the Lower-Tier
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Distribution Account not later than the P&I Advance Date relating to the
Distribution Date on which the final distribution on the Certificates is to
occur, an amount in immediately available funds equal to the above-described
purchase price or Termination Price, as applicable (exclusive of any portion
thereof payable to any Person other than the Certificateholders pursuant to
Section 3.05(a), which portion shall be deposited in the Certificate Account).
In addition, the Servicer shall transfer to the Lower-Tier Distribution Account
all amounts required to be transferred thereto on such P&I Advance Date from
the Certificate Account pursuant to the first paragraph of Section 3.04(b),
together with any other amounts on deposit in the Certificate Account that
would otherwise be held for future distribution. Upon confirmation that such
final deposits have been made, the Trustee shall release or cause to be
released to the Servicer, the Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates, as applicable, the
Mortgage Files for the remaining Mortgage Loans and shall execute all
assignments, endorsements and other instruments furnished to it by the
Servicer, the Special Servicer, the Holders of the Controlling Class or the
Holders of the Class [LR] Certificates, as applicable, as shall be necessary to
effectuate transfer of the Mortgage Loans and REO Properties remaining in the
Trust Fund.
For purposes of this Section 9.01, the Special Servicer shall have the
first option to terminate the Trust Fund, then the Servicer, than the Holders
of the Controlling Class and then the Holders of the Class [LR] Certificates.
For purposes of this Section 9.01, the Directing Certificateholder, with the
consent of the Holders of the Controlling Class, shall act on behalf of the
Holders of the Controlling Class in purchasing the assets of the Trust Fund and
terminating the Trust.
Notice of any termination pursuant to this Section 9.01 shall be given
promptly by the Paying Agent by letter to Certificateholders and each Rating
Agency and, if not previously notified pursuant to this Section 9.01, to the
other parties hereto mailed (a) in the event such notice is given in connection
with the purchase of all of the Mortgage Loans and each REO Property remaining
in the Trust Fund, not earlier than the 15th day and not later than the 25th
day of the month next preceding the month of the final distribution on the
Certificates, or (b) otherwise during the month of such final distribution on
or before the P & I Advance Determination Date in such month, in each case
specifying (i) the Distribution Date upon which the Trust Fund will terminate
and final payment of the Certificates will be made, (ii) the amount of any such
final payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Certificates at the offices of the Certificate Registrar
or such other location therein designated.
After transferring the Lower-Tier Distribution Amount and the amount
of any Prepayment Premiums and Yield Maintenance Charges distributable pursuant
to Section 4.01(d) to the Upper-Tier Distribution Account pursuant to Section
3.04(b) and upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Paying Agent shall
distribute to each Certificateholder so presenting and surrendering its
Certificates such Certificateholder's Percentage Interest of that portion of
the amounts then on deposit in the Upper-Tier Distribution Account that are
allocable to payments on the Class of Certificates so presented and
surrendered. Amounts on deposit in the Upper-Tier Distribution Account as of
the final Distribution Date (exclusive of any portion of such amounts payable
or reimbursable
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to any Person pursuant to clause (ii) of Section 3.05(c)) shall be allocated
for the purposes, in the amounts and in accordance with the priority set forth
in Sections 4.01(a) and 4.01(e) and shall be distributed in termination and
liquidation of the Uncertificated Lower-Tier Interests and the Class [LR]
Certificates in accordance with Sections 4.01(b) and (d). Any funds not
distributed on such Distribution Date shall be set aside and held uninvested in
trust for the benefit of Certificateholders not presenting and surrendering
their Certificates in the aforesaid manner and shall be disposed of in
accordance with this Section 9.01 and Section 4.01(g).
SECTION 9.02. Additional Termination Requirements.
In the event the Servicer, the Special Servicer, the Holders of the
Controlling Class or the Holders of the Class [LR] Certificates purchases all
of the Mortgage Loans and each REO Property remaining in the Trust Fund as
provided in Section 9.01, the Trust Fund shall be terminated in accordance with
the following additional requirements, which are intended to meet the
definition of a "qualified liquidation" in Section 860F(a)(4) of the Code:
(i) the Servicer shall specify the first day in the 90-day
liquidation period in a statement attached to each of the Upper-Tier
REMIC's and the Lower-Tier REMIC's final Tax Return pursuant to
Treasury regulation Section 1.860F-1 and shall satisfy all
requirements of a qualified liquidation under Section 860F of the Code
and any regulations thereunder;
(ii) during such 90-day liquidation period and at or prior to
the time of the making of the final payment on the Certificates, the
Trustee shall sell all of the assets of the Trust Fund to the
Servicer, the Special Servicer, the Holders of the Controlling Class
or the Holders of the Class [LR] Certificates, as applicable, for
cash; and
(iii) immediately following the making of the final payment
on the Uncertificated Lower-Tier Interests and the Certificates, the
Paying Agent shall distribute or credit, or cause to be distributed or
credited, to the Holders of the Class [LR] Certificates (in the case
of the Lower-Tier REMIC) and the Class [R] Certificates (in the case
of the Upper-Tier REMIC) all cash on hand (other than cash retained to
meet claims), and the Trust Fund and each of the Lower-Tier REMIC and
the Upper-Tier REMIC shall terminate at that time.
[End of Article IX]
ARTICLE X.
ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration.
(a) The Servicer shall make an election to treat each of the
Lower-Tier REMIC and the Upper-Tier REMIC as a REMIC under the Code and, if
necessary, under applicable state law. Such election will be made on Form 1066
or other appropriate federal tax or information
144
return (including Form 8811) or any appropriate state return for the taxable
year ending on the last day of the calendar year in which the Uncertificated
Lower-Tier Interests and the Certificates are issued. For the purposes of the
REMIC election in respect of the Upper-Tier REMIC, each Class of the Regular
Certificates shall be designated as the "regular interests" and the Class [R]
Certificates shall be designated as the sole class of "residual interests" in
the Upper-Tier REMIC. For purposes of the REMIC election in respect of the
Lower-Tier REMIC, each Class of Uncertificated Lower-Tier Interests shall be
designated as the "regular interests" and the Class [LR] Certificates shall be
designated as the sole class of "residual interests" in the Lower-Tier REMIC.
None of the Special Servicer, the Servicer and the Trustee shall permit the
creation of any "interests" (within the meaning of Section 860G of the Code) in
the Lower-Tier REMIC or the Upper-Tier REMIC other than the foregoing
interests.
(b) The Closing Date is hereby designated as the "startup day" of each
of the Lower-Tier REMIC and the Upper-Tier REMIC within the meaning of Section
860G(a)(9) of the Code.
(c) The Servicer shall act on behalf of each REMIC in relation to any
tax matter or controversy involving either REMIC and shall represent each REMIC
in any administrative or judicial proceeding relating to an examination or
audit by any governmental taxing authority with respect thereto. The legal
expenses, including without limitation attorneys' or accountants' fees, and
costs of any such proceeding and any liability resulting therefrom shall be
expenses of the Trust Fund and the Servicer shall be entitled to reimbursement
therefor out of amounts attributable to the Mortgage Loans and any REO
Properties on deposit in the Certificate Account as provided by Section 3.05(a)
unless such legal expenses and costs are incurred by reason of the Servicer's
willful misfeasance, bad faith or gross negligence. The Holder of the largest
Percentage Interest in each of the Class [R] and Class [LR] Certificates shall
be designated, in the manner provided under Treasury Regulations Section
1.860F-4(d) and temporary Treasury Regulations Section 301.6231(a)(7)-IT, as
the "tax matters person" of the Upper-Tier REMIC and the Lower-Tier REMIC,
respectively. By their acceptance thereof, the Holders of the largest
Percentage Interest in each of the Class [R] and Class [LR] Certificates hereby
agrees to irrevocably appoint the Servicer as their agent to perform all of the
duties of the "tax matters person" for Upper-Tier REMIC and the Lower-Tier
REMIC, respectively.
(d) The Servicer shall prepare or cause to be prepared and shall file,
or cause to be filed, all of the Tax Returns that it determines are required
with respect to each of the Lower-Tier REMIC and the Upper-Tier REMIC created
hereunder and deliver such Tax Returns in a timely manner to the Trustee and
the Trustee shall sign such Tax Returns in a timely manner. The expenses of
preparing such returns shall be borne by the Servicer without any right of
reimbursement therefor. The Servicer agrees to indemnify and hold harmless the
Trustee with respect to any tax or liability arising from the Trustee's signing
of Tax Returns that contain errors or omissions.
(e) The Servicer shall provide or cause to be provided (i) to any
Transferor of a Class [R] Certificate or Class [LR] Certificate such
information as is necessary for the application of any tax relating to the
transfer of such Class [R] Certificate or Class [LR] Certificate to any Person
who is a Disqualified Organization, or in the case of a Transfer to an Agent
thereof, to
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such Agent, (ii) to the Trustee and the Trustee shall forward to the
Certificateholders such information or reports as are required by the Code or
the REMIC Provisions including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption) and
(iii) to the Internal Revenue Service the name, title, address and telephone
number of the "tax matters person" who will serve as the representative of each
of the Lower-Tier REMIC and the Upper-Tier REMIC created hereunder.
(f) The Servicer shall take such actions and shall cause the Trust
Fund to take such actions as are reasonably within the Servicer's control and
the scope of its duties more specifically set forth herein as shall be
necessary to maintain the status of each of the Lower-Tier REMIC and the
Upper-Tier REMIC as a REMIC under the REMIC Provisions (and the Trustee shall
assist the Servicer, to the extent reasonably requested by the Servicer to do
so). Neither the Servicer nor the Special Servicer shall knowingly or
intentionally take any action, cause the Trust Fund to take any action or fail
to take (or fail to cause to be taken) any action reasonably within its control
and the scope of duties more specifically set forth herein, that, under the
REMIC Provisions, if taken or not taken, as the case may be, could (i) endanger
the status of either the Lower-Tier REMIC or the Upper-Tier REMIC as a REMIC or
(ii) result in the imposition of a tax upon either the Lower-Tier REMIC or the
Upper-Tier REMIC or the Trust Fund (including but not limited to the tax on
"prohibited transactions" as defined in Section 860F(a)(2) of the Code and the
tax on contributions to a REMIC set forth in Section 860G(d) of the Code, but
not including the tax on "net income from foreclosure property") (either such
event, an "Adverse REMIC Event") unless the Servicer receives an Opinion of
Counsel (at the expense of the party seeking to take such action or, if such
party fails to pay such expense, and the Servicer determines that taking such
action is in the best interest of the Trust Fund and the Certificateholders, at
the expense of the Trust Fund, but in no event at the expense of the Servicer
or the Trustee) to the effect that the contemplated action will not, with
respect to the Trust Fund, the Lower-Tier REMIC or the Upper-Tier REMIC created
hereunder, endanger such status or, unless the Servicer determines in its sole
discretion to indemnify the Trust Fund against such tax, result in the
imposition of such a tax (not including a tax on "net income from foreclosure
property"). The Trustee shall not take or fail to take any action (whether or
not authorized hereunder) as to which the Servicer has advised it in writing
that it has received an Opinion of Counsel to the effect that an Adverse REMIC
Event could occur with respect to such action. In addition, prior to taking any
action with respect to the Trust Fund, either the Lower-Tier REMIC or the
Upper-Tier REMIC or any of its assets, or causing the Trust Fund or either the
Lower-Tier REMIC or the Upper-Tier REMIC to take any action, which is not
expressly permitted under the terms of this Agreement, the Trustee will consult
with the Servicer or its designee, in writing, with respect to whether such
action could cause an Adverse REMIC Event to occur with respect to the Trust
Fund or either the Lower-Tier REMIC or the Upper-Tier REMIC and the Trustee
shall not take any such action or cause the Trust Fund or either the Lower-Tier
REMIC or the Upper-Tier REMIC to take any such action as to which the Servicer
has advised it in writing that an Adverse REMIC Event could occur. The Servicer
may consult with counsel to make such written advice, and the cost of same
shall be borne by the party seeking to take the action not expressly permitted
by this Agreement, but in no event at the expense of the Servicer or the
Trustee. At all times as may be required by the Code, the Servicer will to the
extent within its control and the scope of its duties more specifically set
forth herein, maintain substantially all of the assets of each of the
Lower-Tier REMIC and the
146
Upper-Tier REMIC as "qualified mortgages" as defined in Section 860G(a)(3) of
the Code and "permitted investments" as defined in Section 860G(a)(5) of the
Code.
(g) In the event that any applicable federal, state or local tax,
including interest, penalties or assessments, additional amounts or additions
to tax, is imposed on either the Lower-Tier REMIC or the Upper-Tier REMIC, such
tax shall be charged against amounts otherwise distributable to the Holders of
the Certificates, except as provided in the last sentence of this Section
10.01(g); provided, that with respect to the estimated amount of tax imposed on
any "net income from foreclosure property" pursuant to Code Section 860G(d) or
any similar tax imposed by a state or local tax authority, the Special Servicer
shall retain in the related REO Account a reserve for the payment of such taxes
in such amounts and at such times as it shall deem appropriate (or as advised
by the Servicer in writing), and shall remit to the Servicer such reserved
amounts as the Servicer shall request in order to pay such taxes. Except as
provided in the preceding sentence, the Servicer shall withdraw from the
Certificate Account sufficient funds to pay or provide for the payment of, and
to actually pay, such tax as is estimated to be legally owed by either the
Lower-Tier REMIC or the Upper-Tier REMIC (but such authorization shall not
prevent the Servicer from contesting, at the expense of the Trust Fund (other
than as a consequence of a breach of its obligations under this Agreement), any
such tax in appropriate proceedings, and withholding payment of such tax, if
permitted by law, pending the outcome of such proceedings). The Servicer is
hereby authorized to and shall segregate, into a separate non-interest bearing
account, the net income from any "prohibited transaction" under Code Section
860F(a) or the amount of any taxable contribution to the Lower-Tier REMIC or
the Upper-Tier REMIC after the Startup Day that is subject to tax under Code
Section 860G(d) and use such income or amount, to the extent necessary, to pay
such prohibited transactions tax. To the extent that any such tax (other than
any such tax paid in respect of "net income from foreclosure property") is paid
to the Internal Revenue Service or applicable state or local tax authorities,
the Servicer shall retain an equal amount from future amounts otherwise
distributable to the Holders of Residual Certificates (as applicable) and shall
distribute such retained amounts, (x) in the case of the Lower-Tier REMIC, to
the Holders of the Uncertificated Lower-Tier Interests to the extent they are
fully reimbursed for any Collateral Support Deficit arising therefrom and then
to the Holders of the Class [LR] Certificates in the manner specified in
Section 4.01(b) and (y) in the case of the Upper-Tier REMIC, to the Holders of
Class [A], Class [B], Class [C], Class [D], Class [E], Class [F], Class [G],
Class [H] and Class [X] Certificates, as applicable, in the manner specified in
Section 4.01(a), to the extent they are fully reimbursed for any Collateral
Support Deficit arising therefrom and then to the Holders of the Class [R]
Certificates. None of the Trustee, the Fiscal Agent, the Servicer or the
Special Servicer shall be responsible for any taxes imposed on either the
Lower-Tier REMIC or the Upper-Tier REMIC except to the extent such taxes arise
as a consequence of a breach of their respective obligations under this
Agreement.
(h) The Trustee (to the extent required to maintain books and records
hereunder) and the Servicer shall, for federal income tax purposes, maintain
books and records with respect to each of the Lower-Tier REMIC and the
Upper-Tier REMIC on a calendar year and on an accrual basis or as otherwise may
be required by the REMIC Provisions.
147
(i) Following the Startup Day, neither the Servicer nor the Trustee
shall accept any contributions of assets to the Lower-Tier REMIC and the
Upper-Tier REMIC unless the Servicer and the Trustee shall have received an
Opinion of Counsel (at the expense of the party seeking to make such
contribution) to the effect that the inclusion of such assets in the Lower-Tier
REMIC or the Upper-Tier REMIC will not (i) cause either the Lower-Tier REMIC or
the Upper-Tier REMIC to fail to qualify as a REMIC at any time that any
Uncertificated Lower-Tier Interests or Certificates are outstanding or (ii)
subject either the Trust Fund, the Lower-Tier REMIC or the Upper-Tier REMIC to
any tax under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
(j) Neither the Servicer nor the Trustee shall enter into any
arrangement by which the Trust Fund or either the Lower-Tier REMIC or the
Upper-Tier REMIC will receive a fee or other compensation for services nor
permit the Trust Fund or either the Lower-Tier REMIC or the Upper-Tier REMIC to
receive any income from assets other than "qualified mortgages" as defined in
Section 860G(a)(3) of the Code or "permitted investments" as defined in Section
860G(a)(5) of the Code.
(k) Solely for the purposes of Section 1.860G-l(a)(4)(iii) of the
Treasury Regulations, the "latest possible maturity date" by which the
Certificate Balance of each Class of Certificates representing a "regular
interact" in the Upper-Tier REMIC and by which the Lower-Tier Principal Amount
of each Class of Uncertificated Lower-Tier Interests representing a "regular
interest" in the Lower-Tier REMIC would be reduced to zero is December 19, 2006
which is the Distribution Date immediately following the latest scheduled
maturity of any Mortgage Loan.
(l) Within 30 days after the Closing Date, the Servicer shall prepare
and file with the Internal Revenue Service Form 8811, "Information Return for
Real Estate Mortgage Investment Conduits (REMIC) and Issuers of Collateralized
Debt Obligations" for the Lower-Tier REMIC and the Upper-Tier REMIC.
(m) Neither the Trustee nor the Servicer shall sell, dispose of or
substitute for any of the Mortgage Loans (except in connection with (i) the
default, imminent default or foreclosure of a Mortgage Loan, including but not
limited to, the acquisition or sale of a Mortgaged Property acquired by deed in
lieu of foreclosure, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of the Trust Fund pursuant to Article IX of this Agreement or (iv)
a purchase of Mortgage Loans pursuant to Article II or III of this Agreement)
or acquire any assets for the Trust Fund or either the Lower-Tier REMIC or the
Upper-Tier REMIC or sell or dispose of any investments in the Certificate
Account, the Distribution Accounts or the REO Account for gain unless it has
received an Opinion of Counsel that such sale, disposition or substitution will
not (a) affect adversely the status of either the Lower-Tier REMIC or the
Upper-Tier REMIC as a REMIC or (b) unless the Servicer has determined in its
sole discretion to indemnify the Trust Fund against such tax, cause the Trust
Fund or either the Lower-Tier REMIC or the Upper-Tier REMIC to be subject to a
tax on "prohibited transactions" pursuant to the REMIC Provisions.
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SECTION 10.02. Depositor, Special Servicer, Paying Agent and Trustee to
Cooperate with Servicer.
(a) The Depositor shall provide or cause to be provided to the
Servicer, within 10 days after the Closing Date, all information or data that
the Servicer reasonably determines to be relevant for tax purposes as to the
valuations and Issue Prices of the Certificates, including, without limitation,
the price, yield, Prepayment Assumption and projected cash flow of the
Certificates.
(b) The Servicer, the Special Servicer, the Paying Agent and the
Trustee shall each furnish such reports, certifications and information, and
access to such books and records maintained thereby, as may relate to the
Certificates or the Trust Fund and as shall be reasonably requested by the
Servicer in order to enable it to perform its duties hereunder.
SECTION 10.03. Use of Agents.
The Servicer shall execute all of its obligations and duties under
this Article X through its corporate trust department located at
_______________________________________. The Servicer may execute any of its
obligations and duties under this Article X either directly or by or through
agents or attorneys. The Servicer shall not be relieved of any of its duties or
obligations under this Article X by virtue of the appointment of any such
agents or attorneys.
[End of Article X]
ARTICLE XI.
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) This Agreement may be amended from time to time by the parties
hereto, without the consent of any of the Certificateholders:
(i) to cure any ambiguity;
(ii) to correct or supplement any provisions herein or
therein, which may be inconsistent with any other provisions herein or
therein or to correct any error;
(iii) to modify, eliminate or add to any of its provisions to
such extent as shall be necessary to maintain the qualification of the
Trust Fund or either the Lower-Tier REMIC or the Upper-Tier REMIC as a
REMIC at all times that any Certificate is outstanding or to avoid or
minimize the risk of the imposition of any tax on the Trust Fund or
either the Lower-Tier REMIC or the Upper-Tier REMIC pursuant to the
Code that would be a claim against the Trust Fund or either the
Lower-Tier REMIC or the Upper-Tier REMIC, provided that the Trustee
has received an Opinion of Counsel to the
149
effect that (a) such action is necessary or desirable to maintain such
qualification or to avoid or minimize the risk of the imposition of
any such tax, (b) such action will not adversely affect in any
material respect the interests of any Certificateholder, and (c) such
change shall not result in the withdrawal, downgrade or qualification
of the then-current rating assigned to any Class of Certificates, as
evidenced by a letter from each Rating Agency to such effect;
(iv) to change the timing and/or nature of deposits into the
Certificate Account, the Distribution Accounts or REO Account or to
change the name in which the Certificate Account is maintained,
provided that (a) the P&I Advance Date shall in no event be later than
the related Distribution Date, (b) such change shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the
interests of any Certificateholder and (c) such change shall not
result in the withdrawal, downgrade or qualification of the
then-current rating assigned to any Class of Certificates, as
evidenced by a letter from each Rating Agency to such effect;
(v) to modify, eliminate or add to the provisions of Section
5.02(d) or any other provision hereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual
interests," provided that (a) such change shall not result in the
withdrawal, downgrade or qualification of the then-current rating
assigned to any Class of Certificates, as evidenced by a letter from
each Rating Agency to such effect, and (b) such change shall not, as
evidenced by an Opinion of Counsel, cause the Trust Fund, the
Lower-Tier REMIC, the Upper-Tier REMIC or any of the
Certificateholders (other than the Transferor) to be subject to a
federal tax caused by a Transfer to a Person that is a Disqualified
Organization or a Non-U.S. Person;
(vi) to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be materially
inconsistent with the provisions of this Agreement, provided that such
action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interests of any Certificateholder
not consenting thereto; and
(vii) to amend or supplement any provision hereof to the
extent necessary to maintain the rating or ratings assigned to each
Class of Certificates by each Rating Agency.
(b) This Agreement may also be amended from time to time by the
parties hereto with the consent of the Holders of Certificates evidencing in
the aggregate not less than 66 2/3% of the Percentage Interests of each Class of
Certificates affected thereby for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Holders of Certificates of such
Class; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of the Holder of such Certificate; or
150
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, in any such case without the consent of the Holders of all
Certificates of such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iv) amend this Section 11.01.
(c) Notwithstanding the foregoing, the Trustee will not be entitled to
consent to any amendment hereto without having first received an Opinion of
Counsel (at the Trust Fund's expense) to the effect that such amendment or the
exercise of any power granted to the Servicer, the Depositor, the Special
Servicer, the Trustee or any other specified person in accordance with such
amendment will not result in the imposition of a tax on the Trust Fund, the
Lower-Tier REMIC or the Upper-Tier REMIC or cause the Lower-Tier REMIC or the
Upper-Tier REMIC to fail to qualify as a REMIC.
(d) Promptly after the execution of any such amendment, the Trustee
shall furnish a statement describing the amendment to each Certificateholder
and the Paying Agent and a copy of such amendment to each Rating Agency.
(e) It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
(f) The Trustee may, but shall not be obligated to, enter into any
amendment pursuant to this Section that affects its rights, duties and
immunities under this Agreement or otherwise.
(g) The cost of any Opinion of Counsel to be delivered pursuant to
Section 11.01(a) or (c) shall be borne by the Person seeking the related
amendment, except that if the Servicer or the Trustee requests any amendment of
this Agreement in furtherance of the rights and interests of
Certificateholders, the cost of any Opinion of Counsel required in connection
therewith pursuant to Section 11.01(a) or (c) shall be payable out of the
Certificate Account.
SECTION 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Servicer at the expense of the Depositor on direction by the
Trustee, but only upon direction accompanied by an Opinion of Counsel (the cost
of which shall be paid by the Depositor) to the effect that such recordation
materially and beneficially affects the interests of the Certificateholders.
151
(b) For the purpose of facilitating the recordation of this Agreement
as herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
(b) No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement or any
Mortgage Loan, unless, with respect to any suit, action or proceeding upon or
under or with respect to this Agreement, such Holder previously shall have
given to the Trustee a written notice of default hereunder, and of the
continuance thereof, as hereinbefore provided, and unless also (except in the
case of a default by the Trustee) the Holders of Certificates of any Class
evidencing not less than 25% of the related Percentage Interests in such Class
shall have made written request upon the Trustee to institute such action, suit
or proceeding in its own name as Trustee hereunder and shall have offered to
the Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and the Trustee,
for 60 days after its receipt of such notice, request and offer of indemnity,
shall have neglected or refused to institute any such action, suit or
proceeding. The Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it hereunder or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or direction
of any of the Holders of Certificates unless such Holders have offered to the
Trustee reasonable security against the costs, expenses and liabilities which
may be incurred therein or hereby. It is understood and intended, and expressly
covenanted by each Certificateholder with every other Certificateholder and the
Trustee, that no one or more Holders of Certificates shall have any right in
any manner whatsoever by virtue of any provision of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of such
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder, which priority or preference is not otherwise provided for
herein, or to enforce any right under this Agreement, except in the manner
herein provided and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of
this
152
Section 11.03(c), each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 11.04. Governing Law.
This Agreement and the Certificates shall be construed in accordance
with the internal laws of the State of New York applicable to agreements made
and to be performed in said State, and the obligations, rights and remedies of
the parties hereunder shall be determined in accordance with such laws.
SECTION 11.05. Notices.
Any communications provided for or permitted hereunder shall be in
writing and, unless otherwise expressly provided herein, shall be deemed to
have been duly given if personally delivered at or mailed by registered mail,
postage prepaid (except for notices to the Trustee which shall be deemed to
have been duly given only when received), to: (i) in the case of the Depositor,
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
Esq., telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇; (ii) in the case of the Servicer,
___________________, ________________________________________ Attention:
____________________ telecopy number: _______________; (iii) in the case of the
Special Servicer, _____________, Attention: __________________, telecopy
number: ____________, with a copy to _____________, Esq., __________________,
telecopy number: ____________; (iv) in the case of the Trustee and the Fiscal
Agent, ___________________, Attention: __________________, Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Series 1998-____, telecopy number:
_____________; (v) in the case of the initial Paying Agent, the initial
Certificate Registrar and the initial Authenticating Agent, _________________,
_____________________, Attention: __________________, (MBS), telecopy number:
_______________; (vi) in the case of the Rating Agencies, (a)
___________________________________________ and (b) _______________________,
Attention:____________________, telecopy number: ___________________; and (vii)
in the case of the Mortgage Loan Sellers, (a) ________________________,
______________________, Attention: ________________, telecopy number
________________________ and (b) ___________________, Attention:
_______________, telecopy number ___________; or as to each such Person such
other address as may hereafter be furnished by such Person to the parties
hereto in writing. Any communication required or permitted to be delivered to a
Certificateholder shall be deemed to have been duly given when mailed first
class, postage prepaid, to the address of such Holder as shown in the
Certificate Register. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or
not the Certificateholder receives such notice.
SECTION 11.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms
153
of this Agreement and shall in no way affect the validity or enforceability of
the other provisions of this Agreement or of the Certificates or the rights of
the Holders thereof.
SECTION 11.07. Grant of a Security Interest.
The Depositor intends that the conveyance of the Depositor's right,
title and interest in and to the Mortgage Loans pursuant to this Agreement
shall constitute a sale and not a pledge of security for a loan. If such
conveyance is deemed to be a pledge of security for a loan, however, the
Depositor intends that the rights and obligations of the parties to such loan
shall be established pursuant to the terms of this Agreement. The Depositor
also intends and agrees that, in such event, (i) the Depositor shall be deemed
to have granted to the Trustee (in such capacity) a first priority security
interest in the Depositor's entire right, title and interest in and to the
assets comprising the Trust Fund, including without limitation, the Mortgage
Loans, all principal and interest received or receivable with respect to the
Mortgage Loans (other than principal and interest payments due and payable
prior to the Cut-off Date and Principal Prepayments received prior to the
Cut-off Date), all amounts held from time to time in the Certificate Account,
the Distribution Account and, if established, the REO Account, and all
reinvestment earnings on such amounts, and all of the Depositor's right, title
and interest in and to the proceeds of any title, hazard or other Insurance
Policies related to such Mortgage Loans and (ii) this Agreement shall
constitute a security agreement under applicable law. This Section 11.07 shall
constitute notice to the Trustee pursuant to any of the requirements of the
applicable UCC.
SECTION 11.08. Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to
the benefit of the respective successors and assigns of the parties hereto, and
all such provisions shall inure to the benefit of the Certificateholders. No
other person, including, without limitation, any Mortgagor, shall be entitled
to any benefit or equitable right, remedy or claim under this Agreement.
SECTION 11.09. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
SECTION 11.10 Notices to the Rating Agencies.
(a) The Trustee shall use reasonable efforts promptly to provide
notice to each Rating Agency with respect to each of the following of which it
has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not
been cured;
(iii) the resignation or termination of the Servicer or the
Special Servicer;
154
(iv) any change in the location of either of the Distribution
Accounts;
(v) the repurchase of Mortgage Loans by a Mortgage Loan
Seller pursuant to Section 3 of the Mortgage Loan Purchase Agreement;
and
(vi) the final payment to any Class of Certificateholders.
(b) The Servicer shall use reasonable efforts promptly to provide
notice to each Rating Agency with respect to each of the following of which it
has actual knowledge:
(i) the resignation or removal of the Trustee;
(ii) any change in the location of the Certificate Account;
and
(iii) any event that would result in the voluntary or
involuntary termination of any insurance of the accounts of the Paying
Agent or the Trustee.
(c) Each of the Servicer and the Special Servicer shall promptly
furnish to each Rating Agency copies of the following:
(i) each of its annual statements as to compliance described
in Section 3.13;
(ii) inspection reports and other items delivered to each of
the Servicer and Special Servicer pursuant to Sections 3.12(a) and
3.12(b);
(iii) each of its annual independent public accountants'
servicing reports described in Section 3.14;
(iv) a Collection Report with respect to each Distribution
Date required to be delivered pursuant to Section 4.02(b); and
(v) each waiver and consent provided pursuant to Section
3.08.
(d) The Paying Agent shall promptly furnish to each Rating Agency a
copy of the statement to Certificateholders distributed pursuant to Section
4.02(a).
[End of Article XI]
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
155
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers thereunto duly authorized, in each
case as of the day and year first above written.
Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc.
Depositor
By:
Name:
Title:
Servicer
By:
Name:
Title:
[__________________________]
Special Servicer
By:
Name:
Title:
[__________________________]
Trustee
By:
Name:
Title:
156
[__________________________]
Fiscal Agent
By: _________________________
Name: ____________________________
Title:_________________________
By: _________________________
Name: ____________________________
Title:_________________________
▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ss.:
COUNTY OF NEW YORK )
On the _______ day of ____________, 1998 before me, a notary public in
and for said State, personally appeared _______________ known to me to be a
__________ of Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc. one of the
corporations that executed the within instrument, and also known to me to be
the person who executed it on behalf of such corporation, and acknowledged to
me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
--------------------------
Notary Public
[Notarial Seal]
▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ss.:
COUNTY OF NEW YORK )
On the _______ day of ____________, 1998, before me, a notary
public in and for said State, personally appeared _______________ known to me
to be a ______________ of , a ________________ corporation that executed the
within instrument, and also known to me to be the person who executed it on
behalf of such corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal the day and year in this certificate first above written.
-------------------------
Notary Public
[Notarial Seal]
159
STATE OF _______________ )
) ss.:
COUNTY OF ______________ )
On the ______ day of __________________, 1998 before me, a notary
public in and for said State, personally appeared _______________ known to me
to be a ____________________ of ________________________, a corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
---------------------------
Notary Public
[Notarial Seal]
160
STATE OF _____________ )
) ss.:
COUNTY OF ____________ )
On the _____ day of _______________, 1998 before me, a notary public
in and for said State, personally appeared ___________________________ known to
me to be a _______________ of __________________, a ______________ corporation
that executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal the day and year in this certificate first above written.
--------------------------
Notary Public
[Notarial Seal]
161
STATE OF _____________ )
) ss.:
COUNTY OF ____________ )
On the _______ day of ____________, 1998 before me, a notary public in
and for said State, personally appeared ______________________ and
______________________, both known to me to be a _____________________ and
________________, respectively, of __________________, a bank organized under
the laws of the ____________ that executed the within instrument, and also
known to me to be the person who executed it on behalf of such bank, and
acknowledged to me that such bank executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
-------------------------
Notary Public
[Notarial Seal]
162
STATE OF _____________ )
) ss.:
COUNTY OF ____________ )
On the _______ day of ____________, 1998 before me, a notary public in
and for said State, personally appeared ______________________ and
______________________, both known to me to be a _____________________ and
________________, respectively, of __________________, a bank organized under
the laws of the ____________ that executed the within instrument, and also
known to me to be the person who executed it on behalf of such bank, and
acknowledged to me that such bank executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
--------------------------
Notary Public
[Notarial Seal]
163
SCHEDULE 1
Computerized Database Information
Field
Identification Number
Property Type
Property City and State
Year Built
Year Renovated
Occupancy Rate as Of ____________
Total Square Feet
Number of units
Original Principal Balance
Prepayment Premium
Note Rate
Annual Debt Service
Current DSCR
Appraised Value (MAI)
Cut-off LTV (MAI)
LTV at Maturity (MAI)
Annual Reserves per Square Foot/Unit
Origination Date
Maturity Date
(Original) Loan Balance Per SF or Per Unit
Current Unpaid Principal Balance
1995 Actual or Rolling 12 Month NOI
Actual Current Annual Net Operating Income
164
SCHEDULE 2
BORROWER CONCENTRATIONS IN EXCESS OF 5%
(IDENTIFIED BY LOAN ID NUMBER ON EXHIBIT A
TO THE PROSPECTUS SUPPLEMENT)
165
EXHIBIT [A-1]
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [A-1]
THE PORTION OF THE CERTIFICATE BALANCE OF THE CERTIFICATES EVIDENCED BY THIS
CERTIFICATE WILL BE DECREASED BY THE PORTION OF PRINCIPAL DISTRIBUTIONS ON THE
CERTIFICATES AND THE PORTION OF COLLATERAL SUPPORT DEFICIT ALLOCABLE TO THIS
CERTIFICATE. ACCORDINGLY, THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE
LESS THAN THAT SET FORTH BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN
ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE PAYING AGENT. THIS
CERTIFICATE CONSTITUTES A REMIC REGULAR INTEREST UNDER THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &, CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.](1)
PASS-THROUGH RATE: ______% APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE MORTGAGE
LOANS AFTER DEDUCTING PAYMENTS
DENOMINATION: $____________ DUE AND PREPAYMENTS RECEIVED ON OR
BEFORE CUT-OFF DATE: $__________________
DATE OF POOLING AND
SERVICING AGREEMENT:
AS OF ____________, 1998 SERVICER:
CUT-OFF DATE: _________, 1998 SPECIAL SERVICER: _____________
CLOSING DATE: _________, 1998 TRUSTEE: _____________________
--------
(1) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co. it shall have this legend.
166
FIRST DISTRIBUTION
DATE: ________________, 1998 FISCAL AGENT: ________________
PAYING AGENT: ________________
APPROXIMATE AGGREGATE
CERTIFICATE BALANCE CUSIP NO. _______________
OF THE CLASS [A-1]
CERTIFICATES AS OF
THE CLOSING DATE: $_______ CERTIFICATE NO.: __________
CLASS [A-1] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT ________________________________
is the registered owner of the interest evidenced by this Certificate in the
Class [A-1] Certificates issued by the Trust Fund created pursuant to the
Pooling and Servicing Agreement, dated as of __________________, 1998 (the
"Pooling and Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc. (hereinafter called the "Depositor", which term includes any
successor entity under the Pooling and Servicing Agreement), the Trustee, the
Special Servicer, the Servicer and the Fiscal Agent. A summary of certain of
the pertinent provisions of the Pooling and Servicing Agreement is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
shall have the meanings assigned thereto in the Pooling and Servicing
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an
167
interest in the Class of Certificates specified on the face hereof equal to the
quotient expressed as a percentage obtained by dividing the Denomination of
this Certificate specified on the face hereof, by the aggregate initial
Certificate Balance of the Class [A-1] Certificates. The Certificates are
designated as the Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-_ and are issued in twelve
Classes as specifically set forth in the Pooling and Servicing Agreement. The
Certificates will evidence in the aggregate 100% of the beneficial ownership of
the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and by which the Certificateholder is
bound. In the case of any conflict between terms specified in this Certificate
and terms specified in the Pooling and Servicing Agreement, the terms of the
Pooling and Servicing Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [A-1]
Pass-Through Rate specified above on the Certificate Balance of this
Certificate immediately prior to each Distribution Date. Principal and interest
allocated to this Certificate on any Distribution Date will be in an amount due
to this Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
168
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No
169
interest shall accrue or be payable to any Certificateholder on any amount held
in trust as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 4.01(g) of
the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $_____________ initial Notional Amount
and in integral multiples of $____________ in excess thereof, with one
Certificate of such Class evidencing an additional amount equal to the
remainder of the initial Notional Amount of such Class. Subject to the terms of
the Pooling and Servicing Agreement, the Offered Certificates (other than the
Class [X] Certificates) will be issued in book-entry form through the
facilities of DTC in Denominations of $____________ initial Certificate
Balance, and in integral multiples of $___________ in excess thereof, with one
Certificate of each such Class evidencing an additional amount equal to the
remainder of the initial Certificate Balance of such Class. Subject to the
terms of the Pooling and Servicing Agreement, the Non-Registered Certificates
(other than the Residual Certificates) will be issued in book-entry form
through the facilities of DTC in Denominations of $____________ initial
Certificate Balance, and in integral multiples of $____________ in excess
thereof, with one Certificate of each such Class evidencing an additional
amount equal to the remainder of the initial Certificate Balance of such Class.
The Class [R] and Class [LR] Certificates will be issued in fully registered,
certificated form, in Denominations representing Percentage Interests of not
less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the
170
Depositor, the Trustee, the Servicer, the Special Servicer, the Fiscal Agent,
the Certificate Registrar nor any such agents shall be affected by any notice
to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the aggregate Percentage Interests of each Class of
Certificates affected by the amendment for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Pooling and Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
171
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on either the
Upper-Tier REMIC or the Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _% of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
172
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
________________, not in
its individual capacity
but solely as Certificate
Registrar under the
Pooling and Servicing
Agreement.
By: ______________________
AUTHORIZED OFFICER
Dated: _______________, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [A-1] CERTIFICATES REFERRED TO IN
THE WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
__________________,
Authenticating Agent
By:_____________________________
AUTHORIZED SIGNATORY
173
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ____Custodian
(Cust)
under Uniform Gifts to
Minors Act_______
(State)
Additional abbreviations may also be used, although not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _____________________________
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
-------------------------- -------------------------------
Dated: NOTICE: The signature to this
assignment must correspond
with the name as written
upon the face of this
Certificate in every
particular without
alteration or enlargement
or any change whatever.
174
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________ for the account
of __________________________ account number _______________ or, if mailed by
check, to _____________________________. Statements should be mailed to
_____________________. This information is provided by assignee named above, or
___________________, as its agent.
175
EXHIBIT [A-2]
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [A-2]
THE PORTION OF THE CERTIFICATE BALANCE OF THE CERTIFICATES EVIDENCED BY THIS
CERTIFICATE WILL BE DECREASED BY THE PORTION OF PRINCIPAL DISTRIBUTIONS ON THE
CERTIFICATES AND THE PORTION OF COLLATERAL SUPPORT DEFICIT ALLOCABLE TO THIS
CERTIFICATE. ACCORDINGLY, THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE
LESS THAN THAT SET FORTH BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN
ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE PAYING AGENT. THIS
CERTIFICATE CONSTITUTES A REMIC REGULAR INTEREST UNDER THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.](2)
PASS-THROUGH RATE: ______% APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE MORTGAGE
LOANS AFTER DEDUCTING PAYMENTS
DENOMINATION: $____________ AND PREPAYMENTS RECEIVED ON OR
BEFORE CUT-OFF
DATE: $__________________
DATE OF POOLING AND
SERVICING AGREEMENT:
AS OF ____________, 1998 SERVICER:
CUT-OFF DATE: _________, 1998 SPECIAL SERVICER: _____________
CLOSING DATE: _________, 1998 TRUSTEE: _____________________
--------
(2) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
176
FIRST DISTRIBUTION
DATE: ________________, 1998 FISCAL AGENT: ________________
PAYING AGENT:
APPROXIMATE AGGREGATE
CERTIFICATE BALANCE CUSIP NO. _______________
OF THE CLASS [A-2]
CERTIFICATES AS OF
THE CLOSING DATE: $_______ CERTIFICATE NO.: __________
CLASS [A-2] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT __________________________
is the registered owner of the interest evidenced by this Certificate in the
Class [A-2] Certificates issued by the Trust Fund created pursuant to the
Pooling and Servicing Agreement, dated as of ___________________, 1998 (the
"Pooling and Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc. (hereinafter called the "Depositor", which term includes any
successor entity under the Pooling and Servicing Agreement), the Trustee, the
Special Servicer, the Servicer and the Fiscal Agent. A summary of certain of
the pertinent provisions of the Pooling and Servicing Agreement is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
shall have the meanings assigned thereto in the Pooling and Servicing
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an
177
interest in the Class of Certificates specified on the face hereof equal to the
quotient expressed as a percentage obtained by dividing the Denomination of
this Certificate specified on the face hereof, by the aggregate initial
Certificate Balance of the Class [A-2] Certificates. The Certificates are
designated as the Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-_ and are issued in twelve
Classes as specifically set forth in the Pooling and Servicing Agreement. The
Certificates will evidence in the aggregate 100% of the beneficial ownership of
the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and by which the Certificateholder is
bound. In the case of any conflict between terms specified in this Certificate
and terms specified in the Pooling and Servicing Agreement, the terms of the
Pooling and Servicing Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [A-2]
Pass-Through Rate specified above on the Certificate Balance of this
Certificate immediately prior to each Distribution Date. Principal and interest
allocated to this Certificate on any Distribution Date will be in an amount due
to this Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
178
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $____________________, by wire transfer of immediately
available funds to the account of such Certificateholder at a bank or other
entity having appropriate facilities therefor. The final distribution on this
Certificate shall be made in like manner, but only upon presentment and
surrender of this Certificate at the offices of the Certificate Registrar or
such other location specified in the notice to Certificateholders of such final
distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No
179
interest shall accrue or be payable to any Certificateholder on any amount held
in trust as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 4.01(g) of
the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $_______ al Notional Amount and in
integral multiples of $______________ excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $_____________ initial Certificate Balance, and in integral
multiples of $_____________ in excess thereof, with one Certificate of each
such Class evidencing an additional amount equal to the remainder of the
initial Certificate Balance of such Class. Subject to the terms of the Pooling
and Servicing Agreement, the Non-Registered Certificates (other than the
Residual Certificates) will be issued in book-entry form through the facilities
of DTC in Denominations of $_______________ initial Certificate Balance, and in
integral multiples of $_________ in excess thereof, with one Certificate of
each such Class evidencing an additional amount equal to the remainder of the
initial Certificate Balance of such Class. The Class [R] and Class [LR]
Certificates will be issued in fully registered, certificated form, in
Denominations representing Percentage Interests of not less than _ %.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the
180
Depositor, the Trustee, the Servicer, the Special Servicer, the Fiscal Agent,
the Certificate Registrar nor any such agents shall be affected by any notice
to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
181
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on either the
Upper-Tier REMIC or the Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
182
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
___________________,
not in its
individual
capacity but
solely as
Certificate
Registrar under
the Pooling and
Servicing
Agreement.
By:
------------------'
AUTHORIZED OFFICER
Dated: , 1998
---------------------
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [A-2] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
------------------,
Authenticating Agent
By:
------------------------
AUTHORIZED SIGNATORY
183
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ____ Custodian
(Cust)
under Uniform Gifts to
Minors Act________
(State)
Additional abbreviations may also be used, though not in the above
list.
184
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
------------------------------- -----------------------------------
Dated: NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of this
Certificate in every particular
without alteration or enlargement or
any change whatever.
-------------------------------
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise,
in immediately available funds to _____________________________________ for the
account of ________________________________, account number
_______________________________________ or, if mailed by check, to
_______________. Statements should be mailed to_______________________ . This
information is provided by assignee named above, or ___________________
___________________, as its agent.
185
EXHIBIT A-3
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-__, CLASS [B]
THIS CLASS [B] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY
SUCH PLAN AND THE APPLICATION OF DEPARTMENT OF LABOR REGULATION ss.
186
2510.3-101), OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL
ACCOUNT UNDER CIRCUMSTANCES WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE
CERTIFICATES BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA AND THE CODE UNDER PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 OR (B) IF SUCH CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE
NAME OF A PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR TO THE EFFECT THAT SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE
BY SUCH PROPOSED PURCHASER OR TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE
TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF ERISA, THE PROHIBITED TRANSACTION PROVISIONS OF
THE CODE OR THE PROVISIONS OF ANY SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN
A "PROHIBITED TRANSACTION" WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE
CODE OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE CERTIFICATE
REGISTRAR, THE SERVICER, THE SPECIAL SERVICER, THE FISCAL AGENT, THE EXTENSION
ADVISER, THE PLACEMENT AGENTS OR THE DEPOSITOR TO ANY OBLIGATION OR LIABILITY
(INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR
ANY SUCH SIMILAR LAW) IN ADDITION TO THOSE SET FORTH IN THE POOLING AND
SERVICING AGREEMENT. THE TRANSFEREE OF A BENEFICIAL INTEREST IN A CERTIFICATE
THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A
PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE.
PASS-THROUGH RATE:__________% APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE MORTGAGE
LOANS AFTER
===================================================================================================================================
DENOMINATION: $ DEDUCTING PAYMENTS DUE AND
PREPAYMENTS RECEIVED ON OR
BEFORE CUT-OFF DATE: $
-----------------------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF , 1998
-----------------------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
-----------------------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
-----------------------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
187
-----------------------------------------------------------------------------------------------------------------------------------
APPROXIMATE AGGREGATE PAYING AGENT:
CERTIFICATE BALANCE OF THE CLASS
[B] CERTIFICATES AS OF THE CLOSING
DATE: $
-----------------------------------------------------------------------------------------------------------------------------------
CUSIP NO.
-----------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE NO.:
===================================================================================================================================
188
CLASS [B] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT ______________________
is the registered owner of the interest evidenced by this Certificate in the
Class [B] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of ____________, 1998 (the "Pooling and
Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[B] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
189
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [B] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments.
190
Interest or other income earned on funds in the Certificate Account and
Distribution Account will be paid to the Servicer as set forth in the Pooling
and Servicing Agreement. As provided in the Pooling and Servicing Agreement,
withdrawals from the Certificate Account shall be made from time to time for
purposes other than distributions to Certificateholders, such purposes
including reimbursement of certain expenses incurred with respect to the
servicing of the Mortgage Loans and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
191
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $__________ initial Notional Amount and
in integral multiples of $__________ in excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $ initial Certificate Balance, and in integral multiples of
$__________ in excess thereof, with one Certificate of each such Class
evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Non-Registered Certificates (other than the Residual
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification
192
of the then-current rating by any Rating Agency, as evidenced by a letter from
such Rating Agency to such effect; to change the timing and/or nature of
deposits into the Certificate Account or Distribution Account or REO Account or
to change the name in which the Certificate Account is maintained, provided,
however, that the P&I Advance Date shall not be later than the related
Distribution Date, an Opinion of Counsel is obtained to the effect that such
action shall not adversely affect in any material respect the interest of any
Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the
193
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or
result in the imposition of a tax on either the Upper-Tier REMIC or the
Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
________________, not in its individual
capacity but solely as Certificate Registrar
under the Pooling and Servicing Agreement.
194
By:
---------------------
AUTHORIZED OFFICER
Dated: , 1998
--------------------
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [B] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
_______________________,
Authenticating Agent
By:________________________
AUTHORIZED SIGNATORY
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - _____ Custodian
(Cust)
under Uniform Gifts to
Minors Act__________
(State)
Additional abbreviations may also be used, though not in the above
list.
195
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
----------------- -------------------------------------
Dated: NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of this
Certificate in every particular
without alteration or enlargement or
any change whatever.
--------------------------
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________for the account
of___________________________________account number___________ or, if mailed by
check, to_____________________________. Statements should be mailed to
______________________________. This information is provided by assignee named
above, or ___________, as its agent.
196
EXHIBIT A-4
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [C]
THIS CLASS [C] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.] 1
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE
--------------------
(1) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
197
ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY SUCH PLAN AND THE
APPLICATION OF DEPARTMENT OF LABOR REGULATION ss. 2510.3-101), OTHER THAN AN
INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT UNDER CIRCUMSTANCES
WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE CERTIFICATES BY SUCH INSURANCE
COMPANY WOULD BE EXEMPT FROM THE PROHIBITED TRANSACTION PROVISIONS OF ERISA AND
THE CODE UNDER PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 OR (B) IF SUCH
CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PERSON DESCRIBED IN
CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR TO THE EFFECT THAT
SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE BY SUCH PROPOSED PURCHASER OR
TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE
"PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA,
THE PROHIBITED TRANSACTION PROVISIONS OF THE CODE OR THE PROVISIONS OF ANY
SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A "PROHIBITED TRANSACTION" WITHIN
THE MEANING OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW, AND WILL NOT
SUBJECT THE TRUSTEE, THE CERTIFICATE REGISTRAR, THE SERVICER, THE SPECIAL
SERVICER, THE FISCAL AGENT, THE EXTENSION ADVISER, THE PLACEMENT AGENTS OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA, SECTION 4975 OF THE CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AND SERVICING AGREEMENT. THE TRANSFEREE OF A
BENEFICIAL INTEREST IN A CERTIFICATE THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE
DEEMED TO REPRESENT THAT IT IS NOT A PERSON DESCRIBED IN CLAUSES (i) OR (ii)
ABOVE.
==================================================================================================================
PASS-THROUGH RATE:____% APPROXIMATE AGGREGATE
SCHEDULED PRINCIPAL
DENOMINATION: $ BALANCE OF THE MORTGAGE
LOANS AFTER DEDUCTING
PAYMENTS DUE AND
PREPAYMENTS RECEIVED ON
OR BEFORE CUT-OFF DATE:
$
------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING AGREEMENT: SERVICER:
AS OF , 1998
------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: , 1998 FISCAL AGENT:
PAYING AGENT:
198
------------------------------------------------------------------------------------------------------------------
APPROXIMATE AGGREGATE CERTIFICATE CUSIP NO.
BALANCE OF THE CLASS [C] CERTIFICATES AS OF
THE CLOSING DATE: $ CERTIFICATE NO.:
==================================================================================================================
CLASS [C] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT____________________
is the registered owner of the interest evidenced by this Certificate in the
Class [C] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of ____________, 1998 (the "Pooling and
Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[C] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set
199
forth in the Pooling and Servicing Agreement. The Certificates will evidence in
the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and by which the Certificateholder is
bound. In the case of any conflict between terms specified in this Certificate
and terms specified in the Pooling and Servicing Agreement, the terms of the
Pooling and Servicing Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [C] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
200
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only
201
upon surrender of this Certificate for registration of transfer at the office
of the Certificate Registrar or at the office of its transfer agent, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Certificate Registrar duly
executed by the Holder hereof or such Holder's attorney-in-fact duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized Denominations will be issued to the designated transferee or
transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $__________ initial Notional Amount and
in integral multiples of $__________ in excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $___________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Non-Registered Certificates (other than the Residual
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any
202
provisions herein or therein that may be inconsistent with any other provisions
herein or therein or to correct any error; to maintain the rating or ratings
assigned to each Class of Certificates by each Rating Agency; to modify,
eliminate or add to any provisions to such extent as is necessary to maintain
the qualification of either the Upper-Tier REMIC or the Lower-Tier REMIC as a
REMIC to avoid or minimize the imposition of any tax, provided, however, an
Opinion of Counsel is obtained to the effect that such action shall not
adversely affect in any material respect the interest of any Certificateholder
and such action is necessary or desirable to avoid such tax and such action
will not result in the withdrawal, downgrade or qualification of the
then-current rating by any Rating Agency, as evidenced by a letter from such
Rating Agency to such effect; to change the timing and/or nature of deposits
into the Certificate Account or Distribution Account or REO Account or to
change the name in which the Certificate Account is maintained, provided,
however, that the P&I Advance Date shall not be later than the related
Distribution Date, an Opinion of Counsel is obtained to the effect that such
action shall not adversely affect in any material respect the interest of any
Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class, the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
203
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on either the
Upper-Tier REMIC or the Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than ________% of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
204
____________________, not in its individual
capacity but solely as Certificate Registrar
under the Pooling and Servicing Agreement.
By: _____________________________________
AUTHORIZED OFFICER
Dated:____________________, 1998
205
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [C] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
----------------------,
Authenticating Agent
By:
---------------------------
AUTHORIZED SIGNATORY
206
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ________ Custodian
(Cust)
under Uniform Gifts to
Minors Act________
(State)
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
----------------------------- -------------------------------
Dated: NOTICE: The signature to this
assignment must correspond with
the name as written upon the face
of this Certificate in every
particular without alteration or
enlargement or any change
whatever.
------------------------
SIGNATURE GUARANTEED
207
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to________________________for the account
of_________________________________________account number
______________________________ or, if mailed by check, to
___________________________________________ . Statements should be mailed to
____________________________________. This information is provided by assignee
named above, or _________________________, as its agent.
208
EXHIBIT A-5
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [D]
THIS CLASS [D] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]2
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE
--------
(2) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
209
ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY SUCH PLAN AND THE
APPLICATION OF DEPARTMENT OF LABOR REGULATION ss. 2510.3-101), OTHER THAN AN
INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT UNDER CIRCUMSTANCES
WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE CERTIFICATES BY SUCH INSURANCE
COMPANY WOULD BE EXEMPT FROM THE PROHIBITED TRANSACTION PROVISIONS OF ERISA AND
THE CODE UNDER PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 OR (B) IF SUCH
CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PERSON DESCRIBED IN
CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR TO THE EFFECT THAT
SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE BY SUCH PROPOSED PURCHASER OR
TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE
"PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA,
THE PROHIBITED TRANSACTION PROVISIONS OF THE CODE OR THE PROVISIONS OF ANY
SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A "PROHIBITED TRANSACTION" WITHIN
THE MEANING OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW, AND WILL NOT
SUBJECT THE TRUSTEE, THE CERTIFICATE REGISTRAR, THE SERVICER, THE SPECIAL
SERVICER, THE FISCAL AGENT, THE EXTENSION ADVISER, THE PLACEMENT AGENTS OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA, SECTION 4975 OF THE CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AND SERVICING AGREEMENT. THE TRANSFEREE OF A
BENEFICIAL INTEREST IN A CERTIFICATE THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE
DEEMED TO REPRESENT THAT IT IS NOT A PERSON DESCRIBED IN CLAUSES (i) OR (ii)
ABOVE.
====================================================================================================================
PASS-THROUGH RATE: % APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE
DENOMINATION: $ MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
--------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF ,
1998
--------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
--------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
--------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
------------------------------------
PAYING AGENT:
210
--------------------------------------------------------------------------------------------------------------------
APPROXIMATE AGGREGATE CUSIP NO.
CERTIFICATE BALANCE OF THE CLASS
[D] CERTIFICATES AS OF THE CLOSING CERTIFICATE NO.:
DATE: $
====================================================================================================================
211
CLASS [D] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT _____________
is the registered owner of the interest evidenced by this Certificate in the
Class [D] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of _________________________________
________________ , 1998 (the "Pooling and Servicing Agreement"), among Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc. (hereinafter called the
"Depositor", which term includes any successor entity under the Pooling and
Servicing Agreement), the Trustee, the Special Servicer, the Servicer and the
Fiscal Agent. A summary of certain of the pertinent provisions of the Pooling
and Servicing Agreement is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein shall have the meanings assigned
thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[D] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
212
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 360 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [D] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments.
213
Interest or other income earned on funds in the Certificate Account and
Distribution Account will be paid to the Servicer as set forth in the Pooling
and Servicing Agreement. As provided in the Pooling and Servicing Agreement,
withdrawals from the Certificate Account shall be made from time to time for
purposes other than distributions to Certificateholders, such purposes
including reimbursement of certain expenses incurred with respect to the
servicing of the Mortgage Loans and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $ , by wire transfer of immediately available funds to
the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
214
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $ initial Notional Amount and in integral
multiples of $ in excess thereof, with one Certificate of such Class evidencing
an additional amount equal to the remainder of the initial Notional Amount of
such Class. Subject to the terms of the Pooling and Servicing Agreement, the
Offered Certificates (other than the Class [X] Certificates) will be issued in
book-entry form through the facilities of DTC in Denominations of $
initial Certificate Balance, and in integral multiples of $ in excess
thereof, with one Certificate of each such Class evidencing an additional
amount equal to the remainder of the initial Certificate Balance of such Class.
Subject to the terms of the Pooling and Servicing Agreement, the Non-Registered
Certificates (other than the Residual Certificates) will be issued in
book-entry form through the facilities of DTC in Denominations of $
initial Certificate Balance, and in integral multiples of $__________ in
excess thereof, with one Certificate of each such Class evidencing an
additional amount equal to the remainder of the initial Certificate Balance of
such Class. The Class [R] and Class [LR] Certificates will be issued in fully
registered, certificated form, in Denominations representing Percentage
Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of the Upper-Tier REMIC or
the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of any tax,
provided, however, an Opinion of Counsel is obtained to the effect that such
action shall not adversely affect in any material respect the interest of any
Certificateholder and such action is necessary or desirable to avoid
215
such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class, the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the
216
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or
result in the imposition of a tax on the Upper-Tier REMIC or the Lower-Tier
REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
217
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
_______________, not in its
individual capacity but solely as
Certificate Registrar under the
Pooling and Servicing Agreement.
By:________________________________
AUTHORIZED OFFICER
Dated:_________________, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [D] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
-------------------,
Authenticating Agent
By: ____________________________
AUTHORIZED SIGNATORY
218
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - _____ Custodian
(Cust)
under Uniform Gifts to
Minors Act________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
--------------- ---------------------------------------------
Dated: NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of this Certificate in every
particular without alteration or enlargement
or any change whatever.
-------------------------
SIGNATURE GUARANTEED
219
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to __________________________ for the account of
_______________ account number _____________________________ ________________
or, if mailed by check, to ___________________________________________.
Statements should be mailed to
_____________________________________________________. This information is
provided by assignee named above, or ______________________________________, as
its agent.
220
EXHIBIT A-6
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [E]
THIS CLASS [E] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]3
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE
--------
(3) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
221
ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY SUCH PLAN AND THE
APPLICATION OF DEPARTMENT OF LABOR REGULATION ss. 2510.3-101), OTHER THAN AN
INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT UNDER CIRCUMSTANCES
WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE CERTIFICATES BY SUCH INSURANCE
COMPANY WOULD BE EXEMPT FROM THE PROHIBITED TRANSACTION PROVISIONS OF ERISA AND
THE CODE UNDER PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 OR (B) IF SUCH
CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PERSON DESCRIBED IN
CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR TO THE EFFECT THAT
SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE BY SUCH PROPOSED PURCHASER OR
TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE
"PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA,
THE PROHIBITED TRANSACTION PROVISIONS OF THE CODE OR THE PROVISIONS OF ANY
SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A "PROHIBITED TRANSACTION" WITHIN
THE MEANING OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW, AND WILL NOT
SUBJECT THE TRUSTEE, THE CERTIFICATE REGISTRAR, THE SERVICER, THE SPECIAL
SERVICER, THE FISCAL AGENT, THE EXTENSION ADVISER, THE PLACEMENT AGENTS OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA, SECTION 4975 OF THE CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AND SERVICING AGREEMENT. THE TRANSFEREE OF A
BENEFICIAL INTEREST IN A CERTIFICATE THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE
DEEMED TO REPRESENT THAT IT IS NOT A PERSON DESCRIBED IN CLAUSES (i) OR (ii)
ABOVE.
====================================================================================================================
PASS-THROUGH RATE: % APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE
DENOMINATION: $ MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
--------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF 1998
--------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
--------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
--------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
PAYING AGENT:
222
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APPROXIMATE AGGREGATE CUSIP NO.
CERTIFICATE BALANCE OF THE CLASS
[E] CERTIFICATES AS OF THE CLOSING CERTIFICATE NO.:
DATE: $
====================================================================================================================
223
CLASS [E] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT ___________________
is the registered owner of the interest evidenced by this Certificate in the
Class [E] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of ____________, 1998 (the "Pooling and
Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[E] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
224
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [E] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Investments. Interest or
225
other income earned on funds in the Certificate Account and Distribution
Account will be paid to the Servicer as set forth in the Pooling and Servicing
Agreement. As provided in the Pooling and Servicing Agreement, withdrawals from
the Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing as least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
226
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $__________ initial Notional Amount and
in integral multiples of $__________ in excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Non-Registered Certificates (other than the Residual
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable
227
to avoid such tax and such action will not result in the withdrawal, downgrade
or qualification of the then-current rating by any Rating Agency, as evidenced
by a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than % of the Percentage Interests of each Class of Certificates affected
by the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling and Servicing
Agreement or of modifying in any manner the rights of the Certificateholders;
provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the
228
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or
result in the imposition of a tax on the Upper-Tier REMIC or the Lower-Tier
REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _% of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
229
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
_____________________, not in its individual
capacity but solely as Certificate Registrar
under the Pooling and Servicing Agreement.
By: _________________________________
AUTHORIZED OFFICER
Dated: , 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [E] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
_______________________,
Authenticating Agent
By:______________________________
AUTHORIZED SIGNATORY
230
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ________ Custodian
(Cust)
under Uniform Gifts to
Minors Act_________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
------------------ -----------------------------------------------
Dated: NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of this Certificate in every
particular without alteration or enlargement
or any change whatever.
231
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SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________ for the account of
_____________________________________ account number
_____________________________ or, if mailed by check, to ________________.
Statements should be mailed to ____________________________. This information
is provided by assignee named above, or _________________________________, as
its agent.
232
EXHIBIT A-7
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [F]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH ALL
APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501 (A)(1), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN
EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY BY THE TRANSFEROR TO
THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE LAST PAGE
OF THIS CERTIFICATE.
THIS CLASS [F] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
233
THE CERTIFICATE REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]4
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY
SUCH PLAN AND THE APPLICATION OF DEPARTMENT OF LABOR REGULATION ss.
2510.3-101), OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL
ACCOUNT UNDER CIRCUMSTANCES WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE
CERTIFICATES BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA AND THE CODE UNDER PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 OR (B) IF SUCH CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE
NAME OF A PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR TO THE EFFECT THAT SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE
BY SUCH PROPOSED PURCHASER OR TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE
TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF ERISA, THE PROHIBITED TRANSACTION PROVISIONS OF
THE CODE OR THE PROVISIONS OF ANY SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN
A "PROHIBITED TRANSACTION" WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE
CODE OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE CERTIFICATE
REGISTRAR, THE SERVICER, THE SPECIAL SERVICER, THE FISCAL
--------
(4) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
234
AGENT, THE EXTENSION ADVISER, THE PLACEMENT AGENTS OR THE DEPOSITOR TO ANY
OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA,
SECTION 4975 OF THE CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO THOSE SET
FORTH IN THE POOLING AND SERVICING AGREEMENT. THE TRANSFEREE OF A BENEFICIAL
INTEREST IN A CERTIFICATE THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE DEEMED TO
REPRESENT THAT IT IS NOT A PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE.
[THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT
PURCHASER OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN
INTEREST HEREIN, IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN
TRANSFER REQUIREMENTS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT. A TRANSFEREE IS ALSO REQUIRED TO DELIVER AN INVESTMENT
REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE
POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A QUALIFIED
INSTITUTIONAL BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND
MAY ALSO BE REQUIRED TO DELIVER AN OPINION OF COUNSEL IF SUCH
TRANSFEREE IS NOT A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING
OF RULE 144A.](5)
--------
(5) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
235
=================================================================================================================
PASS-THROUGH RATE: % APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE
DENOMINATION: SET FORTH ON MORTGAGE LOANS AFTER DEDUCTING
SCHEDULE A PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
-----------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF , 1998
-----------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
-----------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
-----------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
PAYING AGENT:
-----------------------------------------------------------------------------------------------------------------
APPROXIMATE AGGREGATE CUSIP NO.
CERTIFICATE BALANCE OF THE
CLASS [F] CERTIFICATES AS OF THE CERTIFICATE NO.:
CLOSING DATE: $
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236
CLASS [F] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT____________________
is the registered owner of the interest evidenced by this Certificate in the
Class [F] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of __________, 1998 (the "Pooling and
Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[F] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
237
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [F] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments.
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Interest or other income earned on funds in the Certificate Account and
Distribution Account will be paid to the Servicer as set forth in the Pooling
and Servicing Agreement. As provided in the Pooling and Servicing Agreement,
withdrawals from the Certificate Account shall be made from time to time for
purposes other than distributions to Certificateholders, such purposes
including reimbursement of certain expenses incurred with respect to the
servicing of the Mortgage Loans and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing as least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
239
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $ _________ initial Notional Amount and in
integral multiples of $ _______ in excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling
and Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $ _________ initial Certificate Balance, and in
integral multiples of $ ______ in excess thereof, with one Certificate of each
such Class evidencing an additional amount equal to the remainder of the
initial Certificate Balance of such Class. Subject to the terms of the Pooling
and Servicing Agreement, the Non-Registered Certificates (other than the
Residual Certificates) will be issued in book-entry form through the
facilities of DTC in Denominations of $ ________ initial
Certificate Balance, and in integral multiples of $ _____ in excess thereof,
with one Certificate of each such Class evidencing an additional amount equal
to the remainder of the initial Certificate Balance of such Class. The Class
[R] and Class [LR] Certificates will be issued in fully registered,
certificated form, in Denominations representing Percentage Interests of
not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable
240
to avoid such tax and such action will not result in the withdrawal, downgrade
or qualification of the then-current rating by any Rating Agency, as evidenced
by a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class, the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the
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Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or
result in the imposition of a tax on the Upper-Tier REMIC or the Lower-Tier
REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _% of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
242
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
______________________, not in its
individual capacity but solely as
Certificate Registrar under the Pooling and
Servicing Agreement.
By:___________________________________
AUTHORIZED OFFICER
Dated:_____________________, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [F] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
________________________,
Authenticating Agent
By:___________________________
AUTHORIZED SIGNATORY
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SCHEDULE A
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Date Certificate Balance of Amount of Book-
Definitive Certificates Entry Certificate Notation Made By
exchanged or transferred
for, or issued in
exchange for or upon
transfer of any
Remaining Principal
interest in this Book-
Entry Certificate
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ______Custodian
(Cust)
under Uniform Gifts to
Minors Act _________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
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(Please insert Social Security or other identifying number of Assignee)
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(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
--------------- ------------------------------------------------------
Dated: NOTICE: The signature to this assignment
must correspond with the name as
written upon the face of this
Certificate in every particular
without alteration or enlargement
or any change whatever.
245
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SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the
account of _____________________ account number ____________________ or, if
mailed by check, to __________________________________________. Statements
should be mailed to __________________________________. This information is
provided by assignee named above, or
______________________________________________, as its agent.
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EXHIBIT A-8
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [G]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH ALL
APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501 (A)(1), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN
EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY BY THE TRANSFEROR TO
THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE LAST PAGE
OF THIS CERTIFICATE.
THIS CLASS [G] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
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THE CERTIFICATE REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]6
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY
SUCH PLAN AND THE APPLICATION OF DEPARTMENT OF LABOR REGULATION ss.
2510.3-101), OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL
ACCOUNT UNDER CIRCUMSTANCES WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE
CERTIFICATES BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA AND THE CODE UNDER PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 OR (B) IF SUCH CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE
NAME OF A PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR TO THE EFFECT THAT SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE
BY SUCH PROPOSED PURCHASER OR TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE
TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF ERISA, THE PROHIBITED TRANSACTION PROVISIONS OF
THE CODE OR THE PROVISIONS OF ANY SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN
A "PROHIBITED TRANSACTION" WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE
CODE OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE CERTIFICATE
REGISTRAR, THE SERVICER, THE SPECIAL SERVICER, THE FISCAL AGENT, THE EXTENSION
ADVISER, THE PLACEMENT AGENTS OR THE DEPOSITOR
--------
(6) If this Certificate represents a Book-Entry Certificate registered in
the
248
TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER
ERISA, SECTION 4975 OF THE CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO THOSE
SET FORTH IN THE POOLING AND SERVICING AGREEMENT. THE TRANSFEREE OF A
BENEFICIAL INTEREST IN A CERTIFICATE THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE
DEEMED TO REPRESENT THAT IT IS NOT A PERSON DESCRIBED IN CLAUSES (i) OR (ii)
ABOVE.
[THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT
PURCHASER OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN
INTEREST HEREIN, IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN
TRANSFER REQUIREMENTS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT. A TRANSFEREE IS ALSO REQUIRED TO DELIVER AN INVESTMENT
REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE
POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A QUALIFIED
INSTITUTIONAL BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND
MAY ALSO BE REQUIRED TO DELIVER AN OPINION OF COUNSEL IF SUCH
TRANSFEREE IS NOT A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING
OF RULE 144A.](7)
--------
(7) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
249
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PASS-THROUGH RATE: % APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE
DENOMINATION: $ MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
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DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF 1998
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CUT-OFF DATE: , 1998 SPECIAL SERVICER:
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CLOSING DATE: , 1998 TRUSTEE:
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FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
PAYING AGENT:
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APPROXIMATE AGGREGATE CUSIP NO.
CERTIFICATE BALANCE OF THE
CLASS [G] CERTIFICATES AS OF THE CERTIFICATE NO.:
CLOSING DATE: $
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250
CLASS [G] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT___________
is the registered owner of the interest evidenced by this Certificate in the
Class [G] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of , 1998 (the "Pooling and Servicing
Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[G] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and
251
by which the Certificateholder is bound. In the case of any conflict between
terms specified in this Certificate and terms specified in the Pooling and
Servicing Agreement, the terms of the Pooling and Servicing Agreement shall
govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [G] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account
252
will be paid to the Servicer as set forth in the Pooling and Servicing
Agreement. As provided in the Pooling and Servicing Agreement, withdrawals from
the Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing as least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $ , by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less
253
than $ ______ initial Notional Amount and in integral multiples of $ _______
in excess thereof, with one Certificate of such Class evidencing an additional
amount equal to the remainder of the initial Notional Amount of such Class.
Subject to the terms of the Pooling and Servicing Agreement, the Offered
Certificates (other than the Class [X] Certificates) will be issued in
book-entry form through the facilities of DTC in Denominations of $ _________
initial Certificate Balance, and in integral multiples of $ ____________ in
excess thereof, with one Certificate of each such Class evidencing an
additional amount equal to the remainder of the initial Certificate Balance of
such Class. Subject to the terms of the Pooling and Servicing Agreement, the
Non-Registered Certificates (other than the Residual Certificates) will be
issued in book-entry form through the facilities of DTC in Denominations of
$ ___________ initial Certificate Balance, and in integral multiples of
$ ____________ in excess thereof, with one Certificate of each such Class
evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than _ %.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate
254
Account or Distribution Account or REO Account or to change the name in which
the Certificate Account is maintained, provided, however, that the P&I Advance
Date shall not be later than the related Distribution Date, an Opinion of
Counsel is obtained to the effect that such action shall not adversely affect
in any material respect the interest of any Certificateholder and that such
action will not result in the withdrawal, downgrade or qualification of the
then-current rating by any Rating Agency, as evidenced by a letter from such
Rating Agency to such effect; to modify, eliminate or add to the provisions of
Section 5.02(d) of the Pooling and Servicing Agreement or any other provision
thereof restricting transfer of the Residual Certificates by virtue of their
being the REMIC "residual interests," provided that such change shall not
result in the withdrawal, downgrade or qualification of the then-current rating
assigned to any Class of Certificates, as evidenced by a letter from each
Rating Agency to such effect, and such change shall not, as evidenced by an
Opinion of Counsel, cause either the Upper-Tier REMIC or the Lower-Tier REMIC
or any of the Certificateholders (other than the Transferor) to be subject to a
federal tax caused by a Transfer to a Person that is a Disqualified
Organization or a Non-U.S. Person; and to make any other provisions with
respect to matters or questions arising under the Pooling and Servicing
Agreement which shall not be materially inconsistent with the provisions of the
Pooling and Servicing Agreement, provided, however, that such action shall not,
as evidenced by an Opinion of Counsel, adversely affect in any material respect
the interest of any Certificateholder not consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than % of the Percentage Interests of each Class of Certificates affected
by the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling and Servicing
Agreement or of modifying in any manner the rights of the Certificateholders;
provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on the
Upper-Tier REMIC or the Lower-Tier REMIC.
255
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
256
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
___________________________, not in its
individual capacity but solely as Certificate
Registrar under the Pooling and Servicing
Agreement.
By: _____________________________
AUTHORIZED OFFICER
Dated:_____________, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [G] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
____________________, Authenticating Agent
By:____________________________
AUTHORIZED SIGNATORY
257
SCHEDULE A
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Certificate Balance of Definitive
Certificates exchanged or
transferred for, or issued in
exchange for or upon transfer of Remaining Principal
an interest in this Book-Entry Amount of Book-
Notation
Date Certificate Entry Certificate Made
By
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258
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - __________ Custodian
(Cust)
under Uniform Gifts to
Minors Act ___________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
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(Please insert Social Security or other identifying number of Assignee)
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(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
------------------- ------------------------------------------------
Dated: NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of this Certificate in every
particular without alteration or enlargement
or any change whatever.
--------------------------
SIGNATURE GUARANTEED
259
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ___________________ for the account of
__________________ account number ________________ or, if mailed by check, to
__________________________. Statements should be mailed to
________________________. This information is provided by assignee named above,
or ____________________, as its agent.
260
EXHIBIT A-9
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [H]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH ALL
APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501 (A)(1), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN
EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY BY THE TRANSFEROR TO
THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE LAST PAGE
OF THIS CERTIFICATE.
THIS CLASS [H] CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN OTHER
CLASSES OF CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT. THE PORTION OF THE CERTIFICATE BALANCE OF THE
CERTIFICATES EVIDENCED BY THIS CERTIFICATE WILL BE DECREASED BY THE PORTION OF
PRINCIPAL DISTRIBUTIONS ON THE CERTIFICATES AND THE PORTION OF COLLATERAL
SUPPORT DEFICIT ALLOCABLE TO THIS CERTIFICATE. ACCORDINGLY, THE CERTIFICATE
BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY
INQUIRY OF THE PAYING AGENT. THIS CERTIFICATE CONSTITUTES A REMIC REGULAR
INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
261
THE CERTIFICATE REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.](1)
THIS CERTIFICATE MAY NOT BE PURCHASED OR TRANSFERRED UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (A) AN INVESTMENT REPRESENTATION LETTER
FROM THE PROPOSED PURCHASER OR TRANSFEREE OF SUCH CERTIFICATE, IN FORM AND
SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE
EFFECT THAT SUCH PROPOSED PURCHASER OR TRANSFEREE IS NOT (i) AN EMPLOYEE
BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (EACH A "PLAN") OR (ii) A PERSON ACTING ON
BEHALF OF OR USING THE ASSETS OF ANY SUCH PLAN (INCLUDING AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY
SUCH PLAN AND THE APPLICATION OF DEPARTMENT OF LABOR REGULATION ss.
2510.3-101), OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL
ACCOUNT UNDER CIRCUMSTANCES WHEREBY THE PURCHASE AND HOLDING OF SUBORDINATE
CERTIFICATES BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA AND THE CODE UNDER PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 OR (B) IF SUCH CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE
NAME OF A PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE, AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR TO THE EFFECT THAT SUCH ACQUISITION AND HOLDING OF SUCH CERTIFICATE
BY SUCH PROPOSED PURCHASER OR TRANSFEREE WILL NOT RESULT IN THE ASSETS OF THE
TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF ERISA, THE PROHIBITED TRANSACTION PROVISIONS OF
THE CODE OR THE PROVISIONS OF ANY SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN
A "PROHIBITED TRANSACTION" WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE
CODE OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE CERTIFICATE
REGISTRAR, THE SERVICER, THE SPECIAL SERVICER, THE FISCAL AGENT, THE EXTENSION
ADVISER, THE PLACEMENT AGENTS OR THE DEPOSITOR TO ANY OBLIGATION OR LIABILITY
(INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA, SECTION 4975 OF THE
262
CODE OR ANY SUCH SIMILAR LAW) IN ADDITION TO THOSE SET FORTH IN THE POOLING AND
SERVICING AGREEMENT. THE TRANSFEREE OF A BENEFICIAL INTEREST IN A CERTIFICATE
THAT IS A BOOK-ENTRY CERTIFICATE SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A
PERSON DESCRIBED IN CLAUSES (i) OR (ii) ABOVE.
[THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER OF
THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN, IS
DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET FORTH IN
THE POOLING AND SERVICING AGREEMENT. A TRANSFEREE IS ALSO REQUIRED TO DELIVER
AN INVESTMENT REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO
THE POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A QUALIFIED
INSTITUTIONAL BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND MAY ALSO BE
REQUIRED TO DELIVER AN OPINION OF COUNSEL IF SUCH TRANSFEREE IS NOT A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A.](8)
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PASS-THROUGH RATE: % APPROXIMATE AGGREGATE SCHEDULED
PRINCIPAL BALANCE OF THE
DENOMINATION: $ MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
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DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF 1998
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CUT-OFF DATE: , 1998 SPECIAL SERVICER:
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CLOSING DATE: , 1998 TRUSTEE:
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FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
PAYING AGENT:
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APPROXIMATE AGGREGATE CUSIP NO.
CERTIFICATE BALANCE OF THE
CLASS [H] CERTIFICATES AS OF THE CERTIFICATE NO.:
CLOSING DATE: $
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(8) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
263
CLASS [H] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT_______________
is the registered owner of the interest evidenced by this Certificate in the
Class [H] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of , 1998 (the "Pooling and Servicing
Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[H] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and
264
by which the Certificateholder is bound. In the case of any conflict between
terms specified in this Certificate and terms specified in the Pooling and
Servicing Agreement, the terms of the Pooling and Servicing Agreement shall
govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of principal and interest then
distributable, if any, allocable to the Class of Certificates of the same Class
as this Certificate for such Distribution Date, all as more fully described in
the Pooling and Servicing Agreement. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date at the Class [H] Pass-Through
Rate specified above on the Certificate Balance of this Certificate immediately
prior to each Distribution Date. Principal and interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
Collateral Support Deficit and Certificate Deferred Interest on the
Mortgage Loans shall be allocated on the applicable Distribution Date to
Certificateholders in the manner set forth in the Pooling and Servicing
Agreement. All Collateral Support Deficit or Certificate Deferred Interest on
the Mortgage Loans allocated to any Class of Certificates will be allocated pro
rata among the outstanding Certificates of such Class.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account
265
will be paid to the Servicer as set forth in the Pooling and Servicing
Agreement. As provided in the Pooling and Servicing Agreement, withdrawals from
the Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing as least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $ , by wire transfer of immediately available funds to
the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less
266
than $ ________ initial Notional Amount and in integral multiples of
$ ________ in excess thereof, with one Certificate of such Class evidencing
an additional amount equal to the remainder of the initial Notional Amount of
such Class. Subject to the terms of the Pooling and Servicing Agreement, the
Offered Certificates (other than the Class [X] Certificates) will be issued in
book-entry form through the facilities of DTC in Denominations of $ ________
initial Certificate Balance, and in integral multiples of $ __________ in
excess thereof, with one Certificate of each such Class evidencing an
additional amount equal to the remainder of the initial Certificate Balance of
such Class. Subject to the terms of the Pooling and Servicing Agreement, the
Non-Registered Certificates (other than the Residual Certificates) will be
issued in book-entry form through the facilities of DTC in Denominations of
$ ________ initial Certificate Balance, and in integral multiples of
$ ________ in excess thereof, with one Certificate of each such Class
evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than _ %.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate
267
Account or Distribution Account or REO Account or to change the name in which
the Certificate Account is maintained, provided, however, that the P&I Advance
Date shall not be later than the related Distribution Date, an Opinion of
Counsel is obtained to the effect that such action shall not adversely affect
in any material respect the interest of any Certificateholder and that such
action will not result in the withdrawal, downgrade or qualification of the
then-current rating by any Rating Agency, as evidenced by a letter from such
Rating Agency to such effect; to modify, eliminate or add to the provisions of
Section 5.02(d) of the Pooling and Servicing Agreement or any other provision
thereof restricting transfer of the Residual Certificates by virtue of their
being the REMIC "residual interests," provided that such change shall not
result in the withdrawal, downgrade or qualification of the then-current rating
assigned to any Class of Certificates, as evidenced by a letter from each
Rating Agency to such effect, and such change shall not, as evidenced by an
Opinion of Counsel, cause either the Upper-Tier REMIC or the Lower-Tier REMIC
or any of the Certificateholders (other than the Transferor) to be subject to a
federal tax caused by a Transfer to a Person that is a Disqualified
Organization or a Non-U.S. Person; and to make any other provisions with
respect to matters or questions arising under the Pooling and Servicing
Agreement which shall not be materially inconsistent with the provisions of the
Pooling and Servicing Agreement, provided, however, that such action shall not,
as evidenced by an Opinion of Counsel, adversely affect in any material respect
the interest of any Certificateholder not consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than % of the Percentage Interests of each Class of Certificates affected
by the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling and Servicing
Agreement or of modifying in any manner the rights of the Certificateholders;
provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on the
Upper-Tier REMIC or the Lower-Tier REMIC.
268
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
____________________________, not in its
individual capacity but solely as Certificate
Registrar under the Pooling and Servicing
Agreement.
By:____________________________
AUTHORIZED OFFICER
Dated:_________________, 1998
269
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [H] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
________________________, Authenticating Agent
By:_______________________________
AUTHORIZED SIGNATORY
270
SCHEDULE A
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Certificate Balance of Definitive
Certificates exchanged or
transferred for, or issued in
exchange for or upon transfer of Remaining Principal
an interest in this Book-Entry Amount of Book-
Notation
Date Certificate Entry Certificate Made
By
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271
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ________ Custodian
(Cust)
under Uniform Gifts to
Minors Act __________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
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(Please insert Social Security or other identifying number of Assignee)
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(Please print or typewrite name and address of assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
-------------- --------------------------
Dated: ___________ NOTICE: The signature to
this assignment must
correspond with the name
as written upon the face
of this Certificate in
every particular without
alteration or enlargement
or any change whatever.
_________________________
SIGNATURE GUARANTEED
272
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ___________________ for the account of
__________________ account number ________________ or, if mailed by check, to
__________________________. Statements should be mailed to
________________________. This information is provided by assignee named above,
or ____________________, as its agent.
273
EXHIBIT A-10
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [X]
THE NOTIONAL AMOUNT ON WHICH THE INTEREST PAYABLE TO THE HOLDERS OF THE CLASS
[X] CERTIFICATES IS BASED WILL BE REDUCED AS A RESULT OF PRINCIPAL PAYMENTS AND
LOSSES ON THE MORTGAGE LOANS. ACCORDINGLY, THE INTEREST PAYABLE PURSUANT TO
THIS CERTIFICATE MAY BE LESS THAN THAT SET FORTH BELOW. THIS CERTIFICATE
CONSTITUTES A REMIC REGULAR INTEREST UNDER THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]9
[OID LEGEND]
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THE PASS-THROUGH RATE ON THE APPROXIMATE AGGREGATE SCHEDULED
CLASS X CERTIFICATES WILL BE EQUAL PRINCIPAL BALANCE OF THE
TO THE EXCESS, IF ANY, OF (i) THE MORTGAGE LOANS AFTER DEDUCTING
WEIGHTED AVERAGE NET MORTGAGE PAYMENTS DUE AND PREPAYMENTS
RATE OF THE MORTGAGED LOANS OVER RECEIVED ON OR BEFORE CUT-OFF
(ii) THE WEIGHTED AVERAGE OF THE DATE:
OTHER CERTIFICATES (OTHER THAN $ ______________
THE RESIDUAL CERTIFICATES) (10)
SERVICER:
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DENOMINATION: $____________ SPECIAL SERVICER:
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(9) If this Certificate represents a Book-Entry Certificate registered in
the name of Cede & Co., it shall have this legend.
(10) As more particularly described in the Pooling and Servicing Agreement,
interest on the Class X Certificates will based upon two separate
components, each with their own Pass-Through Rate and Notional Amount.
274
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DATE OF POOLING AND SERVICING TRUSTEE:
AGREEMENT: AS OF , 1998
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CUT-OFF DATE: , 1998 FISCAL AGENT:
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CLOSING DATE: , 1998 PAYING AGENT:
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FIRST DISTRIBUTION DATE: CUSIP NO.
, 1998
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APPROXIMATE AGGREGATE NOTIONAL CERTIFICATE NO.:
AMOUNT OF THE CLASS [X]
CERTIFICATES AS OF THE CLOSING
DATE: $
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275
CLASS [X] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT ______________
is the registered owner of the interest evidenced by this Certificate in the
Class [X] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of , 1998 (the "Pooling and Servicing
Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Notional Amount of the Class [X]
Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇ Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
1998-2 and are issued in twelve Classes as specifically set forth in the
Pooling and Servicing Agreement. The Certificates will evidence in the
aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Certificateholder by
virtue of the acceptance hereof assents and
276
by which the Certificateholder is bound. In the case of any conflict between
terms specified in this Certificate and terms specified in the Pooling and
Servicing Agreement, the terms of the Pooling and Servicing Agreement shall
govern.
This Certificate is a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(l) and 860D of the Internal Revenue Code of 1986, as amended. Each
Holder of this Certificate, by acceptance hereof, agrees to treat, and take no
action inconsistent with the treatment of, this Certificate in accordance with
the preceding sentence for purposes of federal income taxes, state and local
income and franchise taxes and other taxes imposed on or measured by income.
Pursuant to the terms of the Pooling and Servicing Agreement, the
Paying Agent shall distribute to the Person in whose name this Certificate is
registered as of the related Record Date, an amount equal to such Person's pro
rata share (based on the Percentage Interest represented by this Certificate)
of that portion of the aggregate amount of interest then distributable, if any,
allocable to the Class of Certificates of the same Class as this Certificate
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement. Holders of this Certificate will not be entitled to
distributions in respect of principal. Holders of this Certificate may be
entitled to Prepayment Premiums and Yield Maintenance Charges as provided in
the Pooling and Servicing Agreement. All sums distributable on this Certificate
are payable in the coin or currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
Interest on this Certificate will accrue (computed as if each year
consisted of 360 days and each month consisted of 30 days) during the Interest
Accrual Period relating to such Distribution Date in an amount equal to the sum
of one-month's interest at the then-applicable Pass-Through Rates on the
notional amounts of the WAC Component and the A-1 Component immediately prior
to such Distribution Date, as specified above. Interest allocated to this
Certificate on any Distribution Date will be in an amount due to this
Certificate's pro rata share of the Available Distribution Amount to be
distributed on the Certificates of this Class as of such Distribution Date,
with a final distribution to be made upon retirement of this Certificate as set
forth in the Pooling and Servicing Agreement.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes
277
including reimbursement of certain expenses incurred with respect to the
servicing of the Mortgage Loans and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and the Paying Agent with wire instructions in writing at least
five Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $ ___________ , by wire transfer of immediately
available funds to the account of such Certificateholder at a bank or other
entity having appropriate facilities therefor. The final distribution on this
Certificate shall be made in like manner, but only upon presentment and
surrender of this Certificate at the offices of the Certificate Registrar or
such other location specified in the notice to Certificateholders of such
final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $ __________ initial Notional Amount
and in integral multiples of $ _________ in excess thereof, with one
Certificate of such Class evidencing an additional amount equal to the
remainder of the initial Notional Amount of such Class. Subject to the terms
of the Pooling and Servicing Agreement,
278
the Offered Certificates (other than the Class [X] Certificates) will be issued
in book-entry form through the facilities of DTC in Denominations of $ initial
Certificate Balance, and in integral multiples of $ in excess thereof, with one
Certificate of each such Class evidencing an additional amount equal to the
remainder of the initial Certificate Balance of such Class. Subject to the
terms of the Pooling and Servicing Agreement, the Non-Registered Certificates
(other than the Residual Certificates) will be issued in book-entry form
through the facilities of DTC in Denominations of $ initial Certificate
Balance, and in integral multiples of $ in excess thereof, with one Certificate
of each such Class evidencing an additional amount equal to the remainder of
the initial Certificate Balance of such Class. The Class [R] and Class [LR]
Certificates will be issued in fully registered, certificated form, in
Denominations representing Percentage Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent, and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action
279
shall not adversely affect in any material respect the interest of any
Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than % of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling
and Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on the
Upper-Tier REMIC or the Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and
280
Servicing Agreement, which notice the Paying Agent is required to promptly
forward to Certificateholders and Rating Agencies in the manner set forth in
the Pooling and Servicing Agreement, to purchase all, but not less than all, of
the Mortgage Loans and all property acquired in respect of any Mortgage Loan
remaining in the Trust Fund, and thereby effect termination of the Trust Fund
and early retirement of the then outstanding Certificates, on any Distribution
Date on which the aggregate Stated Principal Balances of the Mortgage Loans and
any REO Loans remaining in the Trust Fund is reduced to less than _ % of the
aggregate Cut-off Date Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
______________________, not in its individual
capacity but solely as Certificate Registrar
under the Pooling and Servicing Agreement.
By: ______________________________
AUTHORIZED OFFICER
Dated:_______________, 1998
281
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [X] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
__________________, Authenticating Agent
By: ____________________________
AUTHORIZED SIGNATORY
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - ________ Custodian
(Cust)
under Uniform Gifts to
Minors Act ________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of assignee)
282
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
Dated: ______________ ________________________
NOTICE: The signature to
this assignment must
correspond with the name
as written upon the face
of this Certificate in
every particular without
alteration or enlargement
or any change whatever.
______________
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ___________________ for the account of
__________________ account number ________________ or, if mailed by check, to
__________________________. Statements should be mailed to
________________________. This information is provided by assignee named above,
or ____________________, as its agent.
283
EXHIBIT A-11
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [R]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH ALL
APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501 (a)(l), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN
EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY BY THE TRANSFEROR TO
THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE LAST PAGE
OF THIS CERTIFICATE.
THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER OF THIS
CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN, IS DEEMED TO
HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT. A TRANSFEREE IS ALSO REQUIRED TO DELIVER AN
INVESTMENT REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE
POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A QUALIFIED INSTITUTIONAL
BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND MAY ALSO BE REQUIRED TO
DELIVER AN OPINION OF COUNSEL IF SUCH TRANSFEREE IS NOT A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY
PERSON WHICH IS AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE
284
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE CODE OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32)
OF ERISA SUBJECT TO ANY FEDERAL, STATE OR , LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH A
"PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN.
THIS CERTIFICATE IS A "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(2) AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. EACH TRANSFEREE OF THIS
CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT.
===================================================================================================================================
PERCENTAGE INTEREST EVIDENCED BY APPROXIMATE AGGREGATE SCHEDULED
THIS CERTIFICATE: ___% PRINCIPAL BALANCE OF THE
MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
-----------------------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF , 1998
-----------------------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
-----------------------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
-----------------------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
-----------------------------------------------------------------------------------------------------------------------------------
CLASS R PERCENTAGE INTEREST: ___% PAYING AGENT:
-----------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE NO.:
===================================================================================================================================
285
CLASS [R] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT_____________
is the registered owner of the interest evidenced by this Certificate in the
Class [R] Certificates issued by the Trust Fund created pursuant to the Pooling
and Servicing Agreement, dated as of ____________, 1998 (the "Pooling and
Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
(hereinafter called the "Depositor", which term includes any successor entity
under the Pooling and Servicing Agreement), the Trustee, the Special Servicer,
the Servicer and the Fiscal Agent. A summary of certain of the pertinent
provisions of the Pooling and Servicing Agreement is set forth hereafter. To
the extent not defined herein, the capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[R] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
286
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Class [R] Certificate is a "residual interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income. The Holder of the largest Percentage Interest in the Class
[R] Certificates shall be the "tax matters person" for the Upper-Tier REMIC
pursuant to Treasury Regulations Section 1.860F-4(d), and the Servicer is
hereby irrevocably designated and shall serve as attorney-in-fact and agent for
any such Person that is the "tax matters person".
Pursuant to the terms of the Pooling and Servicing Agreement,
distributions, if any, on this Certificate shall be made by the Paying Agent to
the extent and subject to the limitations set forth in the Pooling and
Servicing Agreement, on the Distribution Date to the Person in whose name this
Certificate is registered as of the related Record Date. All sums distributable
on this Certificate are payable in the coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public and
private debts.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the Holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and Paying Agent with wire instructions in writing as least five
Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $ , by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
appropriate
287
facilities therefor. The final distribution on this Certificate shall be made
in like manner, but only upon presentment and surrender of this Certificate at
the offices of the Certificate Registrar or such other location specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Each Person who has or who acquires any Ownership Interest in a Class
[R] Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and
to have irrevocably authorized the Paying Agent under Section 5.02(d) of the
Pooling and Servicing Agreement to deliver payments to a Person other than such
Person. The rights of each Person acquiring any Ownership Interest in a Class
[R] Certificate are expressly subject to the following provisions: (A) No
Person holding or acquiring any Ownership Interest in a Class [R] Certificate
shall be a Disqualified Organization or agent thereof (including a nominee,
middleman or similar person) (an "Agent"), a Plan or a Person acting on behalf
of or investing the assets of a Plan (such Plan or Person, an "ERISA Prohibited
Holder") or a Non-U.S. Person and shall promptly notify the Servicer, the
Trustee, Paying Agent and the Certificate Registrar of any change or impending
change to such status; (B) In connection with any proposed Transfer of any
Ownership Interest in a Class [R] Certificate, the Certificate Registrar shall
require delivery to it, and no Transfer of any Class [R] Certificate shall be
registered until the Certificate Registrar receives, an affidavit substantially
in the form attached to the Pooling and Servicing Agreement as Exhibit D-1 (a
"Transfer Affidavit") from the proposed Transferee, in form and substance
satisfactory to the Certificate Registrar, representing and warranting, among
other things, that such Transferee is not a Disqualified
288
Organization or Agent thereof, an ERISA Prohibited Holder or a Non-U.S. Person,
and that it has reviewed the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement and agrees to be bound by them; (C) Notwithstanding the
delivery of a Transfer Affidavit by a proposed Transferee under clause (B)
above, if the Certificate Registrar has actual knowledge that the proposed
Transferee is a Disqualified Organization or Agent thereof, an ERISA Prohibited
Holder or a Non-U.S. Person, no Transfer of an Ownership Interest in a Class
[R] Certificate to such proposed Transferee shall be effected; and (D) Each
Person holding or acquiring any Ownership Interest in a Class [R] Certificate
shall agree (1) to require a Transfer Affidavit from any prospective Transferee
to whom such Person attempts to transfer its Ownership Interest in such Class
[R] Certificate and (2) not to transfer its Ownership Interest in such Class
[R] Certificate unless it provides to the Certificate Registrar a letter
substantially in the form attached to the Pooling and Servicing Agreement as
Exhibit D-2 (a "Transferor Letter") certifying that, among other things, it has
no actual knowledge that such prospective Transferee is a Disqualified
Organization, an Agent thereof, an ERISA Prohibited Holder or a Non-U.S.
Person.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $ initial Notional Amount and
in integral multiples of $ in excess thereof, with one Certificate
of such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling
and Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $ initial Certificate Balance, and in integral multiples
of $ in excess thereof, with one Certificate of each such Class
evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. Subject to the terms of the Pooling
and Servicing Agreement, the Non-Registered Certificates (other than the
Residual Certificates) will be issued in book-entry form through the facilities
of DTC in Denominations of $ initial Certificate Balance, and in
integral multiples of $ in excess thereof, with one Certificate
of each such Class evidencing an additional amount equal to the remainder of
the initial Certificate Balance of such Class. The Class [R] and Class [LR]
Certificates will be issued in fully registered, certificated form, in
Denominations representing Percentage Interests of not less than _ %.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
289
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than % of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
290
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on the
Upper-Tier REMIC or Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
291
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
__________________________,
not in its individual
capacity but solely as
Certificate Registrar
under the Pooling and
Servicing Agreement.
By: _____________________
AUTHORIZED OFFICER
Dated _______, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [R] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
--------------------,
Authenticating Agent
By:_______________________
AUTHORIZED SIGNATORY
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
292
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT - _______ Custodian
(Cust)
under Uniform Gifts to
Minors Act __________
(State)
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
Dated: _____________ ________________________
NOTICE: The signature to
this assignment must
correspond with the name
as written upon the face
of this Certificate in
every particular without
alteration or enlargement
or any change whatever.
_____________
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
293
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ___________________ for the account of
__________________ account number ________________ or, if mailed by check, to
__________________________. Statements should be mailed to
________________________. This information is provided by assignee named above,
or ____________________, as its agent.
294
EXHIBIT A-12
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-_, CLASS [LR]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH ALL
APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501 (a)(l), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT IN
EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY BY THE TRANSFEROR TO
THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE LAST PAGE
OF THIS CERTIFICATE.
THE INITIAL INVESTOR IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER OF THIS
CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN, IS DEEMED TO
HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT. A TRANSFEREE IS ALSO REQUIRED TO DELIVER AN
INVESTMENT REPRESENTATION LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE
POOLING AND SERVICING AGREEMENT IF SUCH TRANSFEREE IS A QUALIFIED INSTITUTIONAL
BUYER OR AN INSTITUTIONAL ACCREDITED INVESTOR, AND MAY ALSO BE REQUIRED TO
DELIVER AN OPINION OF COUNSEL IF SUCH TRANSFEREE IS NOT A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY
PERSON WHICH IS AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE
295
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE CODE OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32)
OF ERISA SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH A
"PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN.
THIS CERTIFICATE IS A "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(2) AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. EACH TRANSFEREE OF THIS
CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT.
==================================================================================================================
PERCENTAGE INTEREST EVIDENCED BY APPROXIMATE AGGREGATE SCHEDULED
THIS CERTIFICATE: ___% PRINCIPAL BALANCE OF THE
MORTGAGE LOANS AFTER DEDUCTING
PAYMENTS DUE AND PREPAYMENTS
RECEIVED ON OR BEFORE CUT-OFF
DATE:
$
------------------------------------------------------------------------------------------------------------------
DATE OF POOLING AND SERVICING SERVICER:
AGREEMENT: AS OF , 1998
------------------------------------------------------------------------------------------------------------------
CUT-OFF DATE: , 1998 SPECIAL SERVICER:
------------------------------------------------------------------------------------------------------------------
CLOSING DATE: , 1998 TRUSTEE:
------------------------------------------------------------------------------------------------------------------
FIRST DISTRIBUTION DATE: FISCAL AGENT:
, 1998
------------------------------------------------------------------------------------------------------------------
CLASS LR PERCENTAGE INTEREST: ___% PAYING AGENT:
------------------------------------------------------------------------------------------------------------------
CERTIFICATE NO.:
==================================================================================================================
296
CLASS [LR] CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund, consisting
primarily of a pool of fixed rate, balloon multifamily and mobile home
community mortgage loans (the "Mortgage Loans"), all payments on or collections
in respect of the Mortgage Loans due after the Cut-off Date, all REO Properties
and revenues received in respect thereof, the mortgagee's rights under the
Insurance Policies, any Assignment of Leases, and any guaranties, escrow
accounts or other collateral as security for the Mortgage Loans, and such
amounts as shall from time to time be held in the Certificate Account, the
Distribution Accounts, and the REO Accounts, formed and sold by
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN Bear
▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., THE SERVICER, THE SPECIAL
SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
THIS CERTIFIES THAT _____________
is the registered owner of the interest evidenced by this Certificate in the
Class [LR] Certificates issued by the Trust Fund created pursuant to the
Pooling and Servicing Agreement, dated as of ____________, 1998 (the "Pooling
and Servicing Agreement"), among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities
Inc. (hereinafter called the "Depositor", which term includes any successor
entity under the Pooling and Servicing Agreement), the Trustee, the Special
Servicer, the Servicer and the Fiscal Agent. A summary of certain of the
pertinent provisions of the Pooling and Servicing Agreement is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
shall have the meanings assigned thereto in the Pooling and Servicing
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Certificates of the series specified on the face hereof (herein
called the "Certificates") and representing an interest in the Class of
Certificates specified on the face hereof equal to the quotient expressed as a
percentage obtained by dividing the Denomination of this Certificate specified
on the face hereof, by the aggregate initial Certificate Balance of the Class
[LR] Certificates. The Certificates are designated as the Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-2 and are issued in twelve Classes as specifically
set forth in the Pooling and Servicing Agreement. The Certificates will
evidence in the aggregate 100% of the beneficial ownership of the Trust Fund.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement and reference is made to that agreement for information
with respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the Trustee.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as
297
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound. In the case of any
conflict between terms specified in this Certificate and terms specified in the
Pooling and Servicing Agreement, the terms of the Pooling and Servicing
Agreement shall govern.
This Class [LR] Certificate is a "residual interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income. The Holder of the largest Percentage Interest in the Class
[LR] Certificates shall be the "tax matters person" for the Lower-Tier REMIC
pursuant to Treasury Regulations Section 1.860F-4 (d), and the Servicer is
hereby irrevocably designated and shall serve as attorney-in-fact and agent for
any such Person that is the "tax matters person".
Pursuant to the terms of the Pooling and Servicing Agreement,
distributions, if any, on this Certificate shall be made by the Paying Agent to
the extent and subject to the limitations set forth in the Pooling and
Servicing Agreement, on the Distribution Date to the Person in whose name this
Certificate is registered as of the related Record Date. All sums distributable
on this Certificate are payable in the coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public and
private debts.
The Certificates are limited in right of payment to, among other
things, certain collections and recoveries respecting the Mortgage Loans, all
as more specifically set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, the Certificate Account and
the Distribution Account will be held in the name of the Servicer and Paying
Agent, respectively, on behalf of the holders of Certificates specified in the
Pooling and Servicing Agreement and the Servicer (with respect to the
Certificate Account) or the Paying Agent (with respect to the Distribution
Account) will be authorized to make withdrawals therefrom. Amounts on deposit
in such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Certificate Account and Distribution Account will
be paid to the Servicer as set forth in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement, withdrawals from the
Certificate Account shall be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
certain expenses incurred with respect to the servicing of the Mortgage Loans
and administration of the Trust Fund.
All distributions under the Pooling and Servicing Agreement to a Class
of Certificates shall be made on each Distribution Date (other than the final
distribution on any Certificate) to Certificateholders of record on the related
Record Date by check mailed to the address set forth therefor in the
Certificate Register or, provided that such Certificateholder (1) has provided
the Trustee and Paying Agent with wire instructions in writing as least five
Business Days prior to the related Record Date and (2) is the Holder of
Certificates with an original Certificate Balance or Notional Amount, as
applicable, of at least $__________, by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity having
298
appropriate facilities therefor. The final distribution on this Certificate
shall be made in like manner, but only upon presentment and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the final Distribution Date because of
the failure of Certificateholders to tender their Certificates shall be set
aside and held uninvested in trust for the benefit of the non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice has been given pursuant to Section 4.01(g) of
the Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation to receive
the final distribution with respect thereto. If within one year after the
second notice not all of such Certificates shall have been surrendered for
cancellation, the Paying Agent may, directly or through an agent, take
appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with
Section 4.01(g) of the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the office of the Certificate
Registrar or at the office of its transfer agent, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney-in-fact duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
Denominations will be issued to the designated transferee or transferees.
Each Person who has or who acquires any Ownership Interest in a Class
[LR] Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and
to have irrevocably authorized the Paying Agent under Section 5.02(d) of the
Pooling and Servicing Agreement to deliver payments to a Person other than such
Person. The rights of each Person acquiring any Ownership Interest in a Class
[LR] Certificate are expressly subject to the following provisions: (A) No
Person holding or acquiring any Ownership Interest in a Class [LR] Certificate
shall be a Disqualified Organization or agent thereof (including a nominee,
middleman or similar person) (an "Agent"), a Plan or a Person acting on behalf
of or investing the assets of a Plan (such Plan or Person, an "ERISA Prohibited
Holder") or a Non-U.S. Person and shall promptly notify the Servicer, the
Trustee, Paying Agent and the Certificate Registrar of any change or impending
change to such status; (B) In connection with any proposed Transfer of any
Ownership Interest in a Class [LR] Certificate, the Certificate Registrar shall
require delivery to it, and no Transfer of any Class [LR] Certificate shall be
registered until the Certificate Registrar receives, an affidavit substantially
in the form attached to the Pooling and Servicing Agreement as Exhibit D-1 (a
"Transfer Affidavit") from the proposed Transferee, in form and substance
satisfactory to the Certificate
299
Registrar, representing and warranting, among other things, that such
Transferee is not a Disqualified Organization or Agent thereof, an ERISA
Prohibited Holder or a Non-U.S. Person, and that it has reviewed the provisions
of Section 5.02(d) of the Pooling and Servicing Agreement and agrees to be
bound by them; (C) Notwithstanding the delivery of a Transfer Affidavit by a
proposed Transferee under clause (B) above, if the Certificate Registrar has
actual knowledge that the proposed Transferee is a Disqualified Organization or
an Agent thereof, an ERISA Prohibited Holder or a Non-U.S. Person, no Transfer
of an Ownership Interest in a Class [LR] Certificate to such proposed
Transferee shall be effected; and (D) Each Person holding or acquiring any
Ownership Interest in a Class [LR] Certificate shall agree (1) to require a
Transfer Affidavit from any prospective Transferee to whom such Person attempts
to transfer its Ownership Interest in such Class [LR] Certificate and (2) not
to transfer its Ownership Interest in such Class [LR] Certificate unless it
provides to the Certificate Registrar a letter substantially in the form
attached to the Pooling and Servicing Agreement as Exhibit D-2 (a "Transferor
Letter") certifying that, among other things, it has no actual knowledge that
such prospective Transferee is a Disqualified Organization, an Agent thereof,
an ERISA Prohibited Holder or a Non-U.S. Person.
Subject to the terms of the Pooling and Servicing Agreement, the Class
[X] Certificates will be issued in book-entry form through the facilities of
DTC in Denominations of not less than $__________ initial Notional Amount and
in integral multiples of $__________ in excess thereof, with one Certificate of
such Class evidencing an additional amount equal to the remainder of the
initial Notional Amount of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Offered Certificates (other than the Class [X]
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. Subject to the terms of the Pooling and
Servicing Agreement, the Non-Registered Certificates (other than the Residual
Certificates) will be issued in book-entry form through the facilities of DTC
in Denominations of $__________ initial Certificate Balance, and in integral
multiples of $__________ in excess thereof, with one Certificate of each such
Class evidencing an additional amount equal to the remainder of the initial
Certificate Balance of such Class. The Class [R] and Class [LR] Certificates
will be issued in fully registered, certificated form, in Denominations
representing Percentage Interests of not less than ___%.
No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange
referred to in Section 5.02 of the Pooling and Servicing Agreement other than
for transfers to Institutional Accredited Investors as provided in Section
5.02(h) thereof. In connection with any transfer to an Institutional Accredited
Investor, the Transferor shall reimburse the Trust for any costs (including the
cost of the Certificate Registrar's counsel's review of the documents and any
legal opinions, submitted by the transferor or transferee to the Certificate
Registrar as provided in Section 5.02 of the Pooling and Servicing Agreement)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum
sufficient to cover any tax, expense or other governmental charge payable in
connection with any such transfer or exchange.
300
The Depositor, the Trustee, the Fiscal Agent, the Servicer, the
Special Servicer, the Paying Agent and the Certificate Registrar and any of
their agents may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
the Servicer, the Special Servicer, the Fiscal Agent, the Certificate Registrar
nor any such agents shall be affected by any notice to the contrary.
The Pooling and Servicing Agreement may be amended from time to time
by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and the
Trustee, without the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may
be inconsistent with any other provisions herein or therein or to correct any
error; to maintain the rating or ratings assigned to each Class of Certificates
by each Rating Agency; to modify, eliminate or add to any provisions to such
extent as is necessary to maintain the qualification of either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC to avoid or minimize the imposition of
any tax, provided, however, an Opinion of Counsel is obtained to the effect
that such action shall not adversely affect in any material respect the
interest of any Certificateholder and such action is necessary or desirable to
avoid such tax and such action will not result in the withdrawal, downgrade or
qualification of the then-current rating by any Rating Agency, as evidenced by
a letter from such Rating Agency to such effect; to change the timing and/or
nature of deposits into the Certificate Account or Distribution Account or REO
Account or to change the name in which the Certificate Account is maintained,
provided, however, that the P&I Advance Date shall not be later than the
related Distribution Date, an Opinion of Counsel is obtained to the effect that
such action shall not adversely affect in any material respect the interest of
any Certificateholder and that such action will not result in the withdrawal,
downgrade or qualification of the then-current rating by any Rating Agency, as
evidenced by a letter from such Rating Agency to such effect; to modify,
eliminate or add to the provisions of Section 5.02(d) of the Pooling and
Servicing Agreement or any other provision thereof restricting transfer of the
Residual Certificates by virtue of their being the REMIC "residual interests,"
provided that such change shall not result in the withdrawal, downgrade or
qualification of the then-current rating assigned to any Class of Certificates,
as evidenced by a letter from each Rating Agency to such effect, and such
change shall not, as evidenced by an Opinion of Counsel, cause either the
Upper-Tier REMIC or the Lower-Tier REMIC or any of the Certificateholders
(other than the Transferor) to be subject to a federal tax caused by a Transfer
to a Person that is a Disqualified Organization or a Non-U.S. Person; and to
make any other provisions with respect to matters or questions arising under
the Pooling and Servicing Agreement which shall not be materially inconsistent
with the provisions of the Pooling and Servicing Agreement, provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Certificateholder not
consenting thereto.
The Pooling and Servicing Agreement may also be amended from time to
time by the Depositor, the Servicer, the Special Servicer, the Fiscal Agent and
the Trustee with the consent of the Holders of Certificates representing not
less than ___% of the Percentage Interests of each Class of Certificates
affected by the amendment for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Pooling and
Servicing Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall:
301
(i) reduce in any manner the amount of, or delay the timing
of, payments which are required to be distributed on any Certificate
without the consent of such Certificateholder; or
(ii) reduce the aforesaid percentage of Certificates of any
Class the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all Certificates of
such Class then outstanding; or
(iii) adversely affect the Voting Rights of any Class of
Certificates without the consent of the Holders of such Class then
outstanding; or
(iv) amend Section 11.01.
No amendment shall be made to the Pooling and Servicing Agreement
unless the Trustee shall have received an Opinion of Counsel that such
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or result in the imposition of a tax on the
Upper-Tier REMIC or the Lower-Tier REMIC.
Any of the Servicer, Special Servicer, the Holders of the Controlling
Class or the Holders of the Class [LR] Certificates (in that order) will have
the option, upon 60 days' prior notice given to the Trustee, Paying Agent and
each of the other parties to the Pooling and Servicing Agreement, which notice
the Paying Agent is required to promptly forward to Certificateholders and
Rating Agencies in the manner set forth in the Pooling and Servicing Agreement,
to purchase all, but not less than all, of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund, and
thereby effect termination of the Trust Fund and early retirement of the then
outstanding Certificates, on any Distribution Date on which the aggregate
Stated Principal Balances of the Mortgage Loans and any REO Loans remaining in
the Trust Fund is reduced to less than _ % of the aggregate Cut-off Date
Principal Balance of all the Mortgage Loans.
The obligations created by the Pooling and Servicing Agreement and the
Trust Fund created thereby (other than the obligation of the Paying Agent to
make payments to Certificateholders as provided for in the Pooling and
Servicing Agreement), shall terminate upon reduction of the Certificate
Balances of all the Certificates to zero (including, without limitation, any
such final payment resulting from a termination of the Trust Fund due to a sale
of its property) pursuant to the terms of the Pooling and Servicing Agreement.
In no event, however, will the Trust created by the Pooling and Servicing
Agreement continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of the
United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose. The Certificate Registrar has executed this Certificate on
behalf of the Trust Fund as Certificate Registrar under the Pooling and
Servicing Agreement and makes no representation or warranty as to any of the
statements contained herein or the validity or sufficiency of the Certificates
or the Mortgage Loans.
302
THIS CERTIFICATE AND THE POOLING AND SERVICING AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed under this official seal.
_______________________________,
not in its individual capacity
but solely as Certificate
Registrar under the Pooling and
Servicing Agreement.
By: _________________________
AUTHORIZED OFFICER
Dated:______________, 1998
CERTIFICATE OF AUTHENTICATION
THIS IS ONE OF THE CLASS [LR] CERTIFICATES REFERRED TO IN THE
WITHIN-MENTIONED POOLING AND SERVICING AGREEMENT.
-------------------------,
Authenticating Agent
By: _____________________
AUTHORIZED SIGNATORY
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common
TEN ENT - as tenants by the
entireties
UNIF GIFT MIN ACT - ________ Custodian
(Cust)
under Uniform Gifts to
Minors Act __________
(State)
303
JT TEN - as joint tenants with
rights of survivorship
and not as tenants in
common
Additional abbreviations may also be used, though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
-------------------------------------------------------------------------------
(Please insert Social Security or other identifying number of Assignee)
-------------------------------------------------------------------------------
(Please print or typewrite name and address of Assignee)
the within Certificate and does hereby or irrevocably constitute and appoint to
transfer the said Certificate in the Certificate register of the within-named
Trust, with full power of substitution in the premises.
_______________ _____________________________________________
Dated: NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of this
Certificate in every particular
without alteration or enlargement or
any change whatever.
____________________________
SIGNATURE GUARANTEED
The signature must be guaranteed by a commercial bank or trust company or by a
member firm of the New York Stock Exchange or another national securities
exchange. Notarized or witnessed signatures are not acceptable.
304
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ___________________________ for the account of
__________________________ account number _____________________________ or, if
_________________________ mailed by check, to ____________________________ .
Statements should be mailed to ___________________ . This information is
provided by assignee named above, or as its agent.
305
EXHIBIT C
FORM OF INVESTMENT REPRESENTATION LETTER
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Transfer of Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-2
Ladies and Gentlemen:
This letter is delivered pursuant to Section 5.02 of the Pooling and
Servicing Agreement dated as of , 1998 (the "Pooling and Servicing
Agreement"), by and among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., as
Depositor, __________________________, as Servicer, , as Special Servicer,
, as Fiscal Agent and , as Trustee on behalf of the
holders of Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-_ (the "Certificates") in
connection with the transfer by (the "Seller") to the
undersigned (the "Purchaser") of $ aggregate Certificate Balance of
Class Certificates (the "Certificate"). Capitalized terms
used and not otherwise defined herein shall have the respective meanings
ascribed to such terms in the Pooling and Servicing Agreement.
In connection with such transfer, the Purchaser hereby represents and
warrants to you and the addressees hereof as follows:
1. Check one of the following:*
[ ] The Purchaser is an institutional "accredited
investor" (an entity meeting the requirements of
Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act of 1933, as amended (the
"1933 Act")) and has such knowledge and experience
in financial and business matters as to be capable
of evaluating the merits and risks of its investment
in the Certificates, and the Purchaser and any
accounts for which it is acting are each able to
bear the economic risk of the Purchaser's or such
account's investment. The Purchaser is acquiring the
Certificates purchased by it for its own account or
for one or more accounts (each of which is an
"institutional accredited investor") as to each of
which the Purchaser exercises sole investment
discretion. The Purchaser hereby undertakes to
reimburse the Trust Fund for any costs incurred by
it in connection with this transfer.
--------
* Purchaser must include one of the following two certifications.
306
[ ] The Purchaser is a "qualified institutional buyer"
within the meaning of Rule 144A ("Rule 144A")
promulgated under the Securities Act of 1933, as
amended (the "1933 Act"). The Purchaser is aware
that the transfer is being made in reliance on Rule
144A, and the Purchaser has had the opportunity to
obtain the information required to be provided
pursuant to paragraph (d)(4)(i) of Rule 144A.
2. The Purchaser's intention is to acquire the Certificate (a) for
investment for the Purchaser's own account or (b) for resale to (i) "qualified
institutional buyers" in transactions under Rule 144A, and not in any event
with the view to, or for resale in connection with, any distribution thereof,
or (ii) to institutional "accredited investors" meeting the requirements of
Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated under the 1933 Act,
pursuant to any other exemption from the registration requirements of the 1933
Act, subject in the case of this clause (ii) to (w) the receipt by the
Certificate Registrar of a letter substantially in the form hereof, (x) the
receipt by the Certificate Registrar of an opinion of counsel acceptable to the
Certificate Registrar that such reoffer, resale, pledge or transfer is in
compliance with the 1933 Act, (y) the receipt by the Certificate Registrar of
such other evidence acceptable to the Certificate Registrar that such reoffer,
resale, pledge or transfer is in compliance with the 1933 Act and other
applicable laws, and (z) a written undertaking to reimburse the Trust for any
costs incurred by it in connection with the proposed transfer. The Purchaser
understands that the Certificate (and any subsequent Certificate) has not been
registered under the 1933 Act, by reason of a specified exemption from the
registration provisions of the 1933 Act which depends upon, among other things,
the bona fide nature of the Purchaser's investment intent (or intent to resell
to only certain investors in certain exempted transactions) as expressed
herein.
3. The Purchaser has reviewed the Private Placement Memorandum
relating to the Certificates (the "Private Placement Memorandum") and the
agreements and other materials referred to therein and has had the opportunity
to ask questions and receive answers concerning the terms and conditions of the
transactions contemplated by the Private Placement Memorandum.
4. The Purchaser acknowledges that the Certificate (and any
Certificate issued on transfer or exchange thereof) has not been registered or
qualified under the 1933 Act or the securities laws of any State or any other
jurisdiction, and that the Certificate cannot be resold unless it is registered
or qualified thereunder or unless an exemption from such registration or
qualification is available.
5. The Purchaser hereby undertakes to be bound by the terms and
conditions of the Pooling and Servicing Agreement in its capacity as an owner
of a Certificate or Certificates, as the case may be (each, a
"Certificateholder"), in all respects as if it were a signatory thereto. This
undertaking is made for the benefit of the Trust, the Certificate Registrar and
all Certificateholders present and future.
6. The Purchaser will not sell or otherwise transfer any portion of
the Certificate or Certificates, except in compliance with Section 5.02 of the
Pooling and Servicing Agreement.
307
7. Check one of the following:**
[ ] The Purchaser is a U.S. Person (as defined below)
and it has attached hereto an Internal Revenue
Service ("IRS") Form W-9 (or successor form).
[ ] The Purchaser is not a U.S. Person and under
applicable law in effect on the date hereof, no
taxes will be required to be withheld by the Trustee
(or its agent) or the Paying Agent with respect to
distributions to be made on the Certificate. The
Purchaser has attached hereto either (i) a duly
executed IRS Form W-8 (or successor form), which
identifies such Purchaser as the beneficial owner of
the Certificate and states that such Purchaser is
not a U.S. Person or (ii) two duly executed copies
of IRS Form 4224 (or successor form), which identify
such Purchaser as the beneficial owner of the
Certificate and state that interest and original
issue discount on the Certificate and Permitted
Investments is, or is expected to be, effectively
connected with a U.S. trade or business. The
Purchaser agrees to provide to the Certificate
Registrar updated IRS Forms W-8 or IRS Forms 4224,
as the case may be, any applicable successor IRS
forms, or such other certifications as the
Certificate Registrar may reasonably request, on or
before the date that any such IRS form or
certification expires or becomes obsolete, or
promptly after the occurrence of any event requiring
a change in the most recent IRS form of
certification furnished by it to the Certificate
Registrar.
For this purpose, "U.S. Person" means a citizen or resident of the United
States for U.S. federal income tax purposes, a corporation, partnership or
other entity created or organized in or under the laws of the United States or
any of its political subdivisions, or an estate the income of which is subject
to U.S. federal income taxation regardless of its source or a trust if (A) for
taxable years beginning after __________, 1998 (or for taxable years ending
after August 20, 1998, if the trustee has made an application election), a
court within the United States is able to exercise primary supervision over the
administration of such trust, and one or more United States fiduciaries have
the authority to control all substantial decisions of such trust, or (B) for
all other taxable years, such trust is subject to United States federal income
tax regardless of the source of its income.
8. Please make all payments due on the Certificates:***
-----------------------
** Each Purchaser must include one of the two alternative certifications.
*** Only to be filled out by Purchasers of Definitive Certificates. Please
select (a) or (b). For holders of Definitive Certificates, wire
transfers are only available if such holder's Definitive Certificates
have an aggregate Certificate Balance or Notional Amount, as
applicable, of at least U.S. $5,000,000.
308
[ ] (a) by wire transfer to the following account at a
bank or entity in New York, New York, having
appropriate facilities therefor:
Bank: ____________________
ABA#: ____________________
Account #: ____________________
Attention: ____________________
[ ] (b) by mailing a check or draft to the following
address:
----------------------
----------------------
----------------------
Very truly yours,
______________________
[The Purchaser]
By: ___________________
Name:
Title
Dated:
309
EXHIBIT D-1
FORM OF TRANSFER AFFIDAVIT
AFFIDAVIT PURSUANT TO SECTION
860E(e)(4) OF THE INTERNAL
REVENUE CODE OF 1986, AS
AMENDED
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That [he] [she] is [Title of Officer] of [Name of Transferee] (the
"Transferee"), a [description of type of entity] duly organized and existing
under the laws of the [State of ] [United States], on behalf of which he makes
this affidavit.
2. That the Transferee's Taxpayer Identification Number is [ ]
3. That the Transferee of a Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc., Commercial Mortgage Pass-Through Certificate, Series 1998-_,
Class [R] [LR] Certificate (the "Class [R] [LR] Certificate") is not a
Disqualified Organization (as defined below) or an agent thereof (including
nominee, middleman or other similar person) (an "Agent"), an ERISA Prohibited
Holder or a Non-U.S. Person (as defined below). For these purposes, a
"Disqualified Organization" means any of (i) the United States, any State or
political subdivision thereof, any possession of the United States, or any
agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, majority of its board of directors is not selected by such
governmental unit), (ii) a foreign government, any international organization,
or any agency or instrumentality of any of the foregoing, (iii) any
organization (other than certain farmers' cooperatives described in Section 521
of the Code) which is exempt from the tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Section 1381(a)(2)(C) of the Code and (v) any other Person so designated by the
Servicer based upon an Opinion of Counsel that the holding of an Ownership
Interest in a Residual Certificate by such Person may cause either the
Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC or any
Person having an Ownership Interest in any Class of Certificates (other than
such Person) to incur a liability for any federal tax imposed under the Code
that would not otherwise be imposed but for the Transfer of an Ownership
Interest in a Residual Certificate to such Person. The terms "United States",
"State" and "international organization" shall have the meanings set forth in
Section 7701 of the Code or successor provisions. For these purposes, "ERISA
Prohibited Holder" means an employee benefit plan subject to Title I of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") or
section 4975 of the Code or any governmental plan (as defined in Section 3(32)
of ERISA) subject to any federal, state or local law which is, to a
310
material extent, similar to the foregoing provisions of ERISA or the Code
(each, a "Plan") or a person investing in the assets of such a Plan. For these
purposes, "Non-U.S. Person" means any person other than a U.S. Person, unless,
with respect to the Transfer of a Residual Certificate, (i) such person holds
such Residual Certificate in connection with the conduct of a trade or business
within the United States and furnishes the Transferor and the Certificate
Registrar with an effective Internal Revenue Service Form 4224 or (ii) the
Transferee delivers to both the Transferor and the Certificate Registrar an
opinion of a nationally recognized tax counsel to the effect that such Transfer
is in accordance with the requirements of the Code and the regulations
promulgated thereunder and that such Transfer of the Residual Certificate will
not be disregarded for federal income tax purposes.
4. That the Transferee historically has paid its debts as they have
come due and intends to pay its debts as they come due in the future and the
Transferee intends to pay taxes associated with holding the Class [R] [LR]
Certificate as they become due.
5. That the Transferee understands that it may incur tax liabilities
with respect to the Class [R] [LR] Certificate in excess of any cash flow
generated by the Class [R] [LR] Certificate.
6. That the Transferee agrees not to transfer the Class [R] [LR]
Certificate to any Person or entity unless (a) the Transferee has received from
such Person or entity an affidavit substantially in the form of this Transfer
Affidavit and (b) the Transferee provides to the Certificate Registrar a letter
substantially in the form of Exhibit D-2 to the Pooling and Servicing Agreement
certifying that it has no actual knowledge that such Person or entity is a
Disqualified Organization or an Agent thereof, an ERISA Prohibited Holder or a
Non-U.S. Person and that it has no reason to know that such Person or entity
does not satisfy the requirements set forth in paragraph 4 hereof.
7. That the Transferee agrees to such amendments of the Pooling and
Servicing Agreement dated as of ____________, 1998 among Bear ▇▇▇▇▇▇▇
Commercial Mortgage Securities Inc., as Depositor, ___________________, as
Servicer, _______________as Special Servicer, _______________, as Trustee and
_______________, as Fiscal Agent (the "Pooling and Servicing Agreement"), as
may be required to further effectuate the restrictions on transfer of the Class
[R] [LR] Certificate to such a Disqualified Organization or an Agent thereof,
an ERISA Prohibited Holder or a Non-U.S. Person. To the extent not defined
herein, the capitalized terms used herein shall have the meanings assigned
thereto in the Pooling and Servicing Agreement.
8. That, if a "tax matters person" is required to be designated with
respect to the [Upper-Tier REMIC] [Lower-Tier REMIC], the Transferee agrees to
act as "tax matters person" and to perform the functions of "tax matters
person" of the [Upper-Tier REMIC] [Lower-Tier REMIC] pursuant to Section
10.01(c) of the Pooling and Servicing Agreement, and agrees to the irrevocable
designation of the Servicer as the Transferee's agent in performing the
function of "tax matters person."
311
9. The Transferee has reviewed, and agrees to be bound by and to abide
by, the provisions of Section 5.02(d) of the Pooling and Servicing Agreement
concerning registration of the transfer and exchange of Class [R] [LR]
Certificates.
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, by its [Title of Officer] this _____ day of 19_ .
[NAME OF TRANSFEREE]
By: ________________________
[Name of Officer]
[Title of Officer]
Personally appeared before me the above-named [Name of Officer], known
or proved to me to be the same person who executed the foregoing instrument and
to be the [Title of Officer] of the Transferee, and acknowledged to me that he
[she] executed the same as his [her] free act and deed and the free act and
deed of the Transferee.
Subscribed and sworn before me this _________________ day of __________, 19 _ .
_____________________
NOTARY PUBLIC
COUNTY OF ____________
STATE OF _____________
My commission expires the ______ day of ______________________________ , 19 _ .
312
EXHIBIT D-2
FORM OF TRANSFEROR LETTER
[Date]
________________________
as Certificate Registrar
Attention:
Re: Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.,
Commercial Mortgage Pass-Through Certificates, Series
1998-_
Ladies and Gentlemen:
[Transferor] has reviewed the attached affidavit of [Transferee], and
has no actual knowledge that such affidavit is not true and has no reason to
know that the requirements set forth in paragraphs 3 and 4 thereof are not
satisfied or that the information contained in paragraphs 3 and 4 thereof is
not true.
Very truly yours,
[Transferor]
______________________
313
EXHIBIT E
(INTENTIONALLY DELETED)
314
EXHIBIT F
REQUEST FOR RELEASE
__________ [Date]
[TRUSTEE]
Re: Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
Commercial Mortgage Pass-Through Certificates,
Series 1998-_,
REQUEST FOR RELEASE
Dear ___________________,
In connection with the administration of the Mortgage Files held by or
on behalf of you as Trustee under a certain Pooling and Servicing Agreement
dated as of ___________, 1998 (the "Pooling and Servicing Agreement"), by and
among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc., as depositor,
_____________, as Fiscal Agent, [the undersigned, as servicer ("the Servicer"),
___________________, as special servicer,] [___________________, as servicer,
the undersigned, as special servicer (the "Special Servicer"),] and you, as
trustee, the undersigned hereby requests a release of the Mortgage File (or the
portion thereof specified below) held by or on behalf of you as Trustee with
respect to the following described Mortgage Loan for the reason indicated
below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting file (or portion thereof):
____1. Mortgage Loan paid in full. The [Servicer] [Special
Servicer] hereby certifies that all amounts received
in connection with the Mortgage Loan have been or
will be credited to the Certificate Account pursuant
to the Pooling and Servicing Agreement.
____2. The Mortgage Loan is being foreclosed.
____3. Other. (Describe)
315
The undersigned acknowledges that the above Mortgage File (or
requested portion thereof) will be held by the undersigned in accordance with
the provisions of the Pooling and Servicing Agreement and will be returned to
you or your designee within ten (10) days of our receipt thereof, unless the
Mortgage Loan has been paid in full, in which case the Mortgage File (or such
portion thereof) will be retained by us permanently, or unless the Mortgage
Loan is being foreclosed, in which case the Mortgage File (or such portion
thereof) will be returned when no longer required by us for such purpose.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
[SERVICER][SPECIAL SERVICER]
By: _________________
Name:
Title:
316
EXHIBIT G
FORM OF ERISA REPRESENTATION LETTER
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Re: Transfer of Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities
Inc., Commercial Mortgage Pass-Through Certificates,
Series 1998-_
Ladies and Gentlemen:
The undersigned (the "Purchaser") proposes to purchase
$_______________ initial Certificate Balance of Bear ▇▇▇▇▇▇▇ Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
1998-_, Class _ (the "Certificate") issued pursuant to that certain Pooling and
Servicing Agreement, dated as of ________________, 1998 (the "Pooling and
Servicing Agreement"), by and among Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities
Inc., as depositor (the "Depositor"), ____________________, as servicer (the
"Servicer"), _______________, as special servicer (the "Special Servicer"),
______________________, as fiscal agent (the "Fiscal Agent") and
_________________, as trustee (the "Trustee"). Capitalized terms used and not
otherwise defined herein have the respective meanings ascribed to such terms in
the Pooling and Servicing Agreement.
In connection with such transfer, the undersigned hereby represents
and warrants to you as follows:
1. The Purchaser is not (a)(i) an employee benefit plan subject to the
fiduciary responsibility provisions of ERISA, (ii) or Section 4975 of the Code
or (iii) a governmental plan, as defined in Section 3(32) of ERISA, subject to
any federal, state or local law ("Similar Law") which is, to a material extent,
similar to the foregoing provisions of ERISA or the Code (each a "Plan") or (b)
a person acting on behalf of or using the assets of any such plan (including an
entity whose underlying assets include plan assets by reason of investment in
the entity by such Plan and the application of Department of Labor Regulation
ss. 2510.3-101, other than an insurance company using assets of its general
account under circumstances whereby the purchase and holding of such
Certificates by such insurance company (i) would be exempt from the prohibited
transaction provisions of ERISA and the Code under Prohibited Transaction Class
Exemption 95-60.
2. The Purchaser understands that if the Purchaser is a Person
referred to in l(a) or (b) above, an Opinion of Counsel in form and substance
satisfactory to the Certificate Registrar and the Depositor to the effect that
the acquisition and holding of such Certificate by such purchaser or transferee
will not result in the assets of the Trust Fund being deemed to be "plan
assets" and subject to the fiduciary responsibility provisions of ERISA, the
prohibited transaction
317
provisions of the Code or the provisions of any Similar Law, will not
constitute or result in a "prohibited transaction" within the meaning of ERISA,
Section 4975 of the Code or any Similar Law, and will not subject the Trustee,
the Certificate Registrar, the Servicer, the Special Servicer, the Fiscal
Agent, the Extension Adviser, the Underwriter or the Depositor to any
obligation or liability (including obligations or liabilities under ERISA,
Section 4975 of the Code or any such Similar Law).
IN WITNESS WHEREOF, the Purchaser hereby executes this ERISA
Representation Letter on the ___th day of ______, _______.
Very truly yours,
________________________
[The Purchaser]
By: __________________
Name:
Title:
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EXHIBIT H
FORM OF DISTRIBUTION DATE STATEMENT
LETTER OF OPINION
Exhibit 5.1
[Letterhead]
December _, 1996
Bear ▇▇▇▇▇▇▇ Commercial Mortgage Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Mortgage Pass-Through Certificates
Gentlemen:
We have acted as your special counsel in connection with the
Registration Statement on Form S-3 (the "Registration Statement"), which
Registration Statement is being filed with the Securities and Exchange
Commission (the "Commission"), pursuant to the Securities Act of 1933, as
amended (the "Act"). The Prospectus describes Mortgage Pass-Through
Certificates ("Certificates") to be sold by Bear ▇▇▇▇▇▇▇ Commercial Mortgage
Securities Inc. (the "Depositor") in one of more series (each, a "Series") of
Certificates. Each Series of Certificates will be issued under a separate
pooling and servicing agreement (each a "Pooling and Servicing Agreement")
among the Depositor, a master servicer (a "Servicer"), a trustee (a "Trustee")
and such other parties to be identified in the Prospectus Supplement for such
Series. The form of Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement") is being filed as an exhibit to the Registration Statement.
Capitalized terms used and not otherwise defined herein have the respective
meanings given to such terms in the Registration Statement.
In rendering the opinions set forth below, we have examined and relied
upon the following: (1) the Registration Statement, including the Prospectus
and the form of Prospectus Supplement constituting a part thereof, each
substantially in the form filed with the Commission; (2) the Pooling and
Servicing Agreement in the form filed with the Commission, and (3) such other
documents, materials and authorities as we have deemed necessary in order
enable us to render our opinion set forth below. We express no opinion with
respect to any Series of Certificates for which we do not act as counsel to the
Depositor.
We express no opinion concerning the laws of any jurisdiction
other than the laws of the State of New York and, where expressly referred to
below, the federal income tax laws of the United States of America.
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Based on and subject to the foregoing, we are of the opinion
that:
1. When a Pooling and Servicing Agreement for a
Series of Certificates has been duly and validly authorized,
executed and delivered by the Depositor, a Servicer, a
Trustee and any other party thereto, such Pooling and
Servicing Agreement will constitute a valid and legally
binding agreement of Depositor, enforceable against the
Depositor in accordance with its terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium and other
laws affecting the enforcement of rights of creditors
generally and to general principles of equity and the
discretion of the court (regardless of whether enforceability
is considered in a proceeding in equity or at law).
2. When a Pooling and Servicing Agreement for a
Series of Certificates has been duly and validly authorized,
executed and delivered by the Depositor, a Servicer, a
trustee and any other party thereto, and the Certificates of
such series have been duly executed, authenticated, delivered
and sold as contemplated in the Registration Statement, such
Certificates will be legally and validly issued, fully paid
and nonassessable, and the holders of such Certificates will
be entitled to the benefits of such Pooling and Servicing
Agreement.
3. The description of federal income tax
consequences appearing under the heading "Certain Federal
Income Tax Consequences" in the Prospectus accurately
describes the material federal income tax consequences to
holders of Offered Certificates, under existing law and
subject to the qualifications and assumptions stated therein.
We hereby consent to the filing of this letter as an exhibit
to the Registration Statement and to the reference to this firm under the
headings "Legal Matters" and "Certain Federal Income Tax Consequences" in the
Prospectus, which is a part of the Registration Statement. This consent is not
to be construed as an admission that we are a person whose consent is required
to be filed with the Registration Statement under the provisions of the Act.
Very truly yours,
/s/ O'Melveny & ▇▇▇▇▇ LLP
-------------------------
O'Melveny & ▇▇▇▇▇ LLP
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